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President Vladimir Putin: Good afternoon, dear colleagues. We have several questions, but I would like to begin with the decision that was discussed at the Cabinet meeting only recently.

And I would like that the Chairman would explain this decision, which concerns compensation to citizens living in Chechnya for lost housing. How this problem has ultimately been formulated by the Government of the Russian Federation and what prospects are there in this regard.

It is clear that this is work requiring time and system. We have both the negative and positive experiences accumulated as a result of the work on the overcoming of natural disasters. I think that they can be applied here too and I count on the Government coping with this task.

Last week one more important decision was made. We had long been debating how to develop health insurance and in the end I know that the debate is over. The Pension Fund will also be enlisted in this work.

I consider that the realization of these proposals and of these Government decisions can and should become one of the priorities for the current and coming years. Special attention ought to be paid to making medical assistance really free. First of all, for the most unprotected categories, and since the Pension Fund will also join in this work, then, it goes without saying, the number of pensioners served and the quality of services provided have to be improved and placed in direct dependence on the money which will additionally be allocated for these purposes. It is important that the funds for payment for medical assistance should be channelled in a targeted manner in equal and sufficient amounts, equally and regardless of the pensioners' places of residence. This is very big work. Very important work.

I know that many Government departments had long been studying the experience of foreign countries. In the end they have adopted just this decision; I think it is well substantiated. It is only important it should be effectively and energetically implemented.

The next question to which I would like to draw attention is the situation evolving in agriculture. From the last year we know: certain financial difficulties arose. The Government took a number of steps with a view to farm support. I cannot say that they encompassed all agricultural enterprises, and the Chairman of the Government and I discussed this question – many farm enterprises are in a sufficiently difficult financial position. The Agriculture Ministry jointly with the Finance Ministry must most energetically respond to this situation. I know a billion and three hundred million are set aside for the ensuring of spring field operations. This money has to be allocated in time, though. The start of financing must this month occur within the specified time, but I think that this is not enough. It will be necessary to see what else has to be done to ensure the normal condition of agriculture – lest we have a decline in comparison with the previous years. I would like to draw attention also to the growing wage arrears, now up 8 percent. This is assuming a systemic character, last year the picture was the same.

And I think the economic block of the Government knows why – this is owing to the Budget Code, owing to the fact that funds get accumulated at the end of the year and an endeavour is made to spend them, with a deficit following at the beginning of the year. I draw your attention, and it is necessary to think of how to rectify the situation, because it cannot be called normal. Finally, though slightly less than last year, but at a sufficient rapid pace inflation has been growing, and this should also be taken note of. Our tasks in curbing inflation are more challenging than last year. Therefore I draw your attention and count on the Government approaching this problem systemically and very neatly so as not to harm the real sector of the economy.

Well now international themes. We have all been constantly watching what is happening around Iraq. I think the most important development of the past week was the decision of the Turkish parliament, which has blocked the possibility of the use of its military bases for the conduct of an operation by the US armed forces against Iraq. Maybe, for somebody it came as a surprise, but not for Russia.

To us it was understandable what the Turkish parliament guided itself by, I think proceeding from the international situation developing around Iraq, proceeding from the situation which is developing in the entire Islamic world. And proceeding from internal political situations, it was difficult to expect from the Islamic Welfare Party, which recently gained a majority in the parliament, a different decision.

I will inform you also about the results of my visit to Bulgaria. In my opinion, it was very successful: we managed to agree on a number of key questions of our cooperation. And I have formed the confidence that relations between Bulgaria and Russia not only can be restored to the previous level of the late 1980s, but that it is also possible to change qualitatively and elevate the level of our cooperation in the immediate future.

That's all I want to say at the beginning.