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The three-day seminar was organised by the Presidential Executive Office on the premises of the Sberbank of Russia Corporate University. This year the event has brought together 280 regional leaders.

Prior to the seminar, Sberbank Board Chairman German Gref briefed Vladimir Putin on the organisation and activities of the Corporate University.

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President of Russia Vladimir Putin: Good afternoon, colleagues, friends.

Meetings that bring together heads of regions and legislative assemblies and city mayors are very useful, and judging by your reaction to such meetings in the past, you are of the same opinion. This is especially important now that we are facing quite a few challenges that we need to tackle in complicated economic and foreign policy conditions.

Obviously, in this situation the need to coordinate the actions of all levels of authority comes to the fore. Efficiency, initiative, leadership qualities of the heads of federal agencies and regional and municipal authorities are of supreme importance.

Each one of you has broad authority and, frankly speaking, you consider yourselves masters of your lands – in the best sense of the word, without diluting its democratic content. I mean that generally speaking, it is good to feel you are the master: you are responsible for the job, for the people and the territory. I repeat, this is true only when these feelings are rooted in the understanding that the future of our entire nation depends on the successful development of each region and city. It is important that despite your high position you retain the desire to acquire new knowledge, to learn from each other and exchange positive experience.

We can judge the maturity of modern leaders by their constant striving for self-improvement, their ability to develop efficient relations with the residents of their region, with communities and civil society institutions.

All of you frequently come to Moscow, of course – for meetings at the Ministries and agencies and at the Government. However, all this is the standard business routine, inevitable and necessary. From time to time, you need to tear yourself away from this routine and meet with your colleagues to exchange experience.

I know that during or right before the first such meeting there was a lot of talk to the effect that you are busy as it is, and this, shall we say nonsense is only distracting you from your work. However, later on, I know that many of you, including those present said they found it interesting and useful. I would like you to retain this mind-set so that you all benefit from the joint work.

I would like to dwell on a number of issues you will be considering here in some detail.

First, the economy. Our strategic goals remain unchanged. We must ensure high economic growth rates, greater efficiency and labour productivity. We have to withstand external pressure by strengthening our economic and financial sovereignty. This is of utmost importance, something we seem to have forgotten, presuming that financial and economic matters are beyond the scope of politics, as we often hear. It turns out that this is not true; on the contrary, they are used as powerful instruments of political pressure. I will get back to this later. Russia in general and the Russian economy should and will remain an inseparable and natural part of the global economy. However, we definitely need to change certain things, the ones that will ensure our sovereignty.

I am not speaking of isolation here, of course, but of making the economy more stable and resistant to external shocks by means of diversifying it, by expanding the non-mineral, high-technology sector of the economy, agriculture and the national financial and banking sectors. Meanwhile, Russia’s choice remains the same: openness to our partners all over the world who are ready to cooperate with us on the basis of equality and mutual benefit.

I described our joint programme of action in great detail in my Address to the Federal Assembly and I expect the regions to have developed their own plans on how to implement its key provisions. We will also continue implementing the Executive Orders of May 2012, including their social component. Naturally, we have to proceed from reality, from the changes that occur both globally and here in this country. However, generally we must aim to meet all the targets. I would like to stress that new challenges do not rule out our commitments to the citizens. We are working for their benefit, after all.

These are not easy times; however, there have been no major surprises. The crisis was predictable and we are already taking measures to stabilise the situation.

As you may know, we have approved the Government’s plan of immediate measures to ensure social and economic stability. Significant funds will be allocated for its implementation that will be directed at enhancing the capitalisation of banks, which are rightly referred to as the economy’s circulatory system, and at supporting agriculture and industry, as well as stabilising the labour market.

Special attention is given to the situation on the food market and with other basic necessity goods, and I would like to ask you to monitor this situation and take timely measures. We all know of the growing prices, and external developments and the state of our economy do not always justify the growth that we are witnessing. We should not let anyone profiteer from any sort of difficulties. They do exist, but often these difficulties and the growing prices are incomparable and we all know that. This applies to imported medicines as well. I would like to add that the Government has allocated funds to compensate for the growth of these prices.

Another thing I would like to draw your attention to is that every region of the Federation needs to work out its own action plan in the economic and social spheres – the way we did back in 2008–2009 with many of those present here. As you may remember, every region developed its own plans – I asked our colleagues in the regions and they did it. We have to do the same thing now. The plans should be very detailed and transparent, without any generalisations or populism. We need precise measurable targets and milestones. The plans should provide a clear answer to the question how we are going to achieve our goals.

I am certain that you will have many good proposals, including those of a federal scope. We will consult you regularly, seek your advice and assess the local situation. Such practice, as I have said, proved productive in 2008–2009.

I would like to stress here that we cannot afford to waste time. You should prepare your teams to work in this tense mode and take measures to radically enhance management quality. We will definitely support those who, despite all odds, continue with the projects they have already launched and are implementing new ones. By the way, now, just as during the previous economic crisis, given the current situation, we need to be very careful about new projects. We must certainly complete the work we have started, and we have to be very careful about new projects, with a clear understanding of the sources of funding.

I would also like to stress that regional and municipal authorities should follow the same agenda. You have to put aside all disputes and conflicts and stop arguing about who ranks higher. The people rank higher than any one of us, the people for whose benefit we do our work should be at the centre. All disputes should be set aside.

I understand that disputes often arise from neutral situations, over different solutions to some complicated issues. However, we are all adults and we know that there is a certain boundary, a difference between productive arguments and squabbles. You are capable of making that out.

In this connection, I would like to turn to the heads of legislative assemblies. You must do everything possible to ensure that all the parties represented in parliaments, even if their views on certain matters differ (and that is the way it should be) take an active and constructive part in legislative work aimed at the development of regions. All sensible ideas and proposals must be taken into account and used, regardless of who submitted them.

I would like to repeat that representatives of parties and public organisations should focus on current matters. You should meet with people more often, maintain a constant dialogue with them and work with the media. In a word, all public and political forces should become involved in practical efforts to demonstrate through their actions that they care for the people, for their region and for the country.

It is very important to explain to the people what priorities have been chosen and why, what can be put off until a later date, and what should not be delayed under any circumstances. This is especially true of the most pressing matters, the ones that are always on our agenda: social matters, housing and utilities and all day-to-day matters.

You know that delayed or unclear explanations of our plans and actions, lack of precision and consistency in changing sensitive areas of life may lead to disapproval on the part of certain professional and social groups. This does not mean the work should not be done. On the contrary, and I will get back to this. However, it should be done carefully, and explanations should be provided of what exactly is being done. Today carelessness is inadmissible. Openness is one of the conditions of our joint efforts to implement the plan to overcome the crisis.

Colleagues, I would like to stress that at present we should by no means stop creating a comfortable environment for small and medium-size businesses. The legal basis on the federal level that sets new standards of a business climate is generally ready. These laws and documents have to work on the entire territory of this country. Their efficiency directly depends on the initiative and quality of administration in Russia’s regions and municipalities.

I would like to stress that small but promising initiatives often grow into serious investment projects and shape the investment potential of the entire country. Active support for private initiative can serve as a launch pad for all those who decide to start their own business. It is necessary to take into account real market requirements and call on people to actively take advantage of the available opportunities to launch and develop their businesses. However, urging people to act is not enough – they have to see that you are creating favourable conditions for them.

We must create advantageous conditions for their operations and explain the incentives entrepreneurs can enjoy locally and regionally. At the same time we have to restrain the zeal of all the numerous inspectors, who, unfortunately, continue feeding off businesses and creating problems for them. You are definitely aware of this; it is a problem for the entire country. This was also detailed in the Address to the Federal Assembly. Please bear this in mind and, if you receive reasonable signals from the business community, you must take immediate action.

The federal plan of immediate measures contains an entire section dedicated to promoting small and medium-size businesses. This includes additional grants for innovative companies and a reduction of excessive oversight. It is important that the regions will be given the right to provide certain tax incentives. All these opportunities for businesses should be taken into consideration and used in the regional plans.

We intentionally decided not to issue any federal directives because we understand that this could lead to a serious reduction in regional revenue – roughly an extra 200–300 billion. And we know of the sensitivity in this sphere. Therefore, we give you the authority to make the appropriate decisions wherever you find it possible.

Practice shows that alignment between the actions of regional and municipal authorities helps create a favourable environment for business initiative and activity. Overall, the successful solution of many issues depends on you, on the competence, initiative and confidence demonstrated by regional authorities.

The least promising strategy today is to wait and see. By being bogged down and putting off decision-making to a later date, you will only add problems for your regions and for the country as a whole. You have to pre-empt any crisis rather than wait for the market situation to change or for the federal authorities to help you. You should search for your own ways out of the situations that may occur. Today each one of you, all the members of your teams have to demonstrate project initiative and active work in this direction. Of course, you should also support the most talented and efficient employees. Do not fear to promote them and create conditions for their further professional growth.

The role of the person heading the region or municipality is clearly significant. A true leader is not one who manages everything singlehandedly, but one who can hear their colleagues and trust them, who can appreciate their proposals and delegate authority, maintaining at the same time constant control over what is being done, how and with what results. These qualities are of special value today. Your personal example, your interested and responsible approach is a very important component of our plans’ success.

We have many untapped reserves in practically all spheres of life. You must analyse them carefully and attract new people by opening up the doors at the regional and municipal level to attract active caring people, of whom there are many in Russia. You must maintain constant frank dialogue with the residents of your territories. You should not leave any proposal, idea or project unattended, and attract the most experienced and talented administrators to occupy state and municipal positions.

We have a proposal, supported by our hosts [Sberbank], on how to better handle professional training, create additional staffing pools and so forth. It is a good proposal; I believe you will consider it in the course of your discussion.

Another matter I would like to touch upon is the division of authority between regional and local bodies of power. You have made numerous proposals on how to improve the work of local government bodies. They were reflected in the updated law passed last May, which made it possible to optimise relations between these levels of authority with due account of each region’s needs and situation.

This is not an easy job and it requires taking into consideration mutual interests and fine-tuning based on deep analysis and the ‘do no harm’ premise. The main goal of such change is to improve the quality of life. We keep speaking of raising the quality of administration because it should lead to this very result.

Moreover, we already have some questionable experience of numerous local government reforms. This time we have to be very precise and efficient, act without haste, but with maximum effect for the regions, for local authorities and for the regions’ residents.

Relevant laws have already been passed by all the regions, but not all of them have proceeded to take practical steps. About a quarter of the regions only took on some local government authority, while a slightly larger number actually redistributed authority between the various levels. I would like to repeat that, given the complexity of the job, we cannot put it off because, as we all know, temporary measures only hinder development. I would like to remind you that it was you and representatives of the municipalities who initiated these changes and the law was amended based on your requests.

Colleagues, despite all the challenges, the past year was a time of true unity of this country’s citizens. We should retain this mindset as we prepare to celebrate a great date – the 70^th anniversary of Victory in the Great Patriotic War. I would like you to organise these events with care and avoid a formalistic approach.

There is another job I find very important on the eve of this anniversary. All regions have to launch a proper, sound and up-to-date educational campaign to promote the truth about World War II. We have to make ourselves heard and be confident and calm as we defend the honour and dignity of our parents and grandparents who defeated Nazism.

You know the level of absurdity and I would even say embarrassment some of our opponents have reached. All for their political ambitions, to restrain Russia and eventually to change the course of history. We must clearly resist these blatant lies, falsifications and distortions of historical facts. You have to organise proper work in your regions involving competent experts, scholars, representatives of public associations and, primarily, youth organisations.

In some cases, it seems what they are saying is such nonsense that nobody will ever take it seriously. However, it stays in the minds of millions and then people will begin to quote it as if it were some primary source. Therefore, we must not ignore this and react to things that may seem to be nonsense, but are in fact very harmful nonsense. However, our reaction should be calm, without hysterics, and we should demonstrate using modern means that this is harmful nonsense. Preparations for the anniversary involve asserting our values. I am sure you can do it with dignity and you will do everything possible and necessary.

I would like to wish you success, including in the course of this seminar, and most importantly – success in your work in your regions and municipalities.

Thank you for your attention.