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President of Russia Vladimir Putin: Good afternoon, colleagues.

I am glad to welcome everyone to our Council’s meeting, one which is attended by the new members. Heads of urban districts, municipal neighbourhoods, urban and rural settlements, as well as representatives of legislative authorities and federal agencies are all present here today. This format will allow us to conduct a substantive, practical discussion, beginning with the specific issues that are a source of concern to citizens, since you’ve all been dealing with such issues in a professional capacity for many years now.

In general, and given the growing importance of local self-government, I believe that we must intensify our Council’s work. I will discuss this in more detail.

I hope that the Council will act as a platform to discuss strategic state policy targets and to improve legislation on local self-government. It should also review the best available self-government practices, and make recommendations on addressing the most pressing problems.

The theme of our meeting today is improving the regulation on oversight of local self-government institutions. Its relevance is indubitable. At almost every meeting, we hear representatives of municipal authorities talking about the non-systemic, often ungrounded and obsessive attention that supervising agencies pay to them and to businesses too. Drafting useless reports, memorandums, and papers for endless audits and inspections consumes a great deal of time and human resources at the expense of real work, not paperwork.

Of course, supervising agencies and oversight agencies perform a very important function, and we must not forget this. They must perform their functions continuously and efficiently, especially when it comes to the life, health and security of our people. As we all know, oversight and monitoring are often indispensable. However, supervision should not impede the work of organisations being audited; no one needs inspections simply for the sake inspecting, without any clear result.

I spoke about the need to improve regulatory oversight in my Address to the Federal Assembly in December 2012. The Government has also received relevant instructions in this regard. I would repeat once again that it is important to introduce public reports by oversight agencies on the conclusions and results of the audits they carry out. When bodies exercising oversight begin to report back to society, then it will become clear how results correspond to the resources expended on them.

Today we will focus on the problems that arise in the process of supervision and oversight.

First, this concerns monitoring the state of social and utilities infrastructure. Many blocks of flats, schools, kindergartens, and libraries that were built decades ago often do not meet current standards. However, we must also understand that these problems have been accumulating for a long time and that no one – no municipal authority – can resolve them in one go. We are to engage in systemic work. In most cases, local authorities simply cannot simultaneously and immediately bring social and engineering infrastructure facilities up to all established standards. This must be taken into account during inspections. A formal approach, which often focuses on quantitative indicators and applying penalties, is not effective in this case and, most importantly, does not improve the quality of municipal services offered. This certainly does not mean that we and municipal officials do not have to think about how to solve the challenges we face, but of course supervising authorities must always proceed with certain realities in mind.

We all know the most important problem in this context: local self-governments’ inadequate fiscal capacities. This issue still has not been entirely resolved, although I would note that between 2006 and 2012 local budget revenues doubled, and increased from 1.5 to nearly 3 trillion rubles [$100 billion].

Government policy with regards to developing municipalities considers further strengthening their economic and financial capacities, as well as their fiscal autonomy, a priority. The government has already passed a number of relevant resolutions and this work will continue; we will consistently go down that path.

The second general problem concerns the fact that oversight bodies act both inconsistently and redundantly, because of faulty legal regulation. I have already said today that the principles governing oversight must change significantly. This fully applies to monitoring local self-government activities. These new approaches must be enshrined in law, and realistic time frames to eliminate breaches, target dates which take into account municipalities’ fiscal and personnel capacities should be set.

Another topic is the quality of municipal legislative acts. Prosecution authorities rightly point out that in some cases their quality leaves much to be desired; this is especially true for small municipalities, particularly those in rural communities. However, our priority should not be pointing at the shortcomings mechanically, but rather raising public awareness. It is not possible to improve municipal affairs simply with sanctions and permanent criticism.

The Justice Ministry of the Russian Federation, with the support of the Regional Development Ministry, has posted draft municipal acts on countering corruption on its website. The practice of preparing sample acts for local authorities has worked well in the regions. I am referring to Komi Republic and the practices used in Krasnoyarsk Territory and Ulyanovsk Region.

Another important question concerns the staffing of local authorities. This has a significant influence on the full exercise of the powers of local self-government institutions, the quality of municipal acts and, ultimately, effective interaction with supervision and oversight authorities. For all these reasons, we must pay the utmost attention to training qualified municipal employees. I would emphasise that this should concern all levels of governance: federal and regional too.

Colleagues,

This year marks the tenth anniversary of the law on the general principles of local self-government organisation in the Russian Federation. Making the transition to the new principles was not easy, but we have compiled extensive experience in current conditions, and of course this requires comprehensive analysis. This is due to the significant role municipalities play in increasing the investment attractiveness of Russian regions, and more generally to our work in almost all fields.

The investment climate to a large extent depends on the specific measures local authorities take. Therefore, I propose that this year we discuss the most urgent issues related to further developing local self-government at the congress of Russian municipalities.

In addition, I think it would be desirable to create permanent, thematic commissions concerned with distribution of powers, territorial organisation, the financial, economic and personnel resources of local self-government, as well as a commission designed to support civic initiatives and develop public control.

I believe that such a commission would be useful with regards to the regulation on oversight of municipalities. The commission’s main focus should be to prepare the recommendations we elaborate in our Council in an informative and high-quality way.

To return to our meeting’s main theme, as I said previously, regulation on oversight should help municipalities exercise their authorities effectively. Not to entertain the illusion of vigorous activity, but to actually improve the situation in healthcare, education, housing and utilities, and to create the conditions for our people to lead high-quality and prosperous lives. This is a shared and important task for oversight agencies, local authorities, and us all.

Let’s start our discussion.

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