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Vladimir Putin: In accordance with established tradition, we are going to review the results of military training this year and the overall situation of the armed forces.

As for priorities for next year, I would suggest that we discuss these issues in relation to the strategic areas that we discussed in detail at a meeting at the Defence Ministry on October 2 of this year.

Let me remind you that in this room not only top army officers are present. Considering the scale and importance of the tasks being tackled in the sphere of military development, members of the federal Government, the Federation Council, the Security Council and the State Duma have also been invited.

First of all, I would like to note that army and navy personnel are successfully coping with the difficult problems that face them, especially regarding the military training of troops. That training has become more intensive in the outgoing year. It has become more focused and more in line with modern requirements.

The number of tactical battalion and regimental exercises has almost doubled, which is a measure of real changes in army training. You know that a significant part of next year’s military budget will be earmarked for military training, and I think that spending must increase in the future.

I would like to note the army and navy successes during the course of the international exercises held this year, including those held within the framework of the Collective Security Treaty Organisation, as well as major command- and staff training exercises in line with the new requirements of military planning and control.

And yet much still remains to be done and to be learnt. The key criterion is that the army must be ready to counter modern threats. And, if you like, to counter the threats of tomorrow rather than fight the wars of the last century. That is why the army’s capability, its strategy and tactics must be flexible and open to everything that is new and advanced. They must be capable of change and evolution.

I think that requires more attention to the study of the character and the current experience of modern armed conflicts. Obviously, that is a challenge for our military science and the analytical services of the General Staff. And of course it is a challenge for the commanders who must effectively and promptly introduce this knowledge in the training of troops at all the levels of military training.

A few words about the training of personnel and the problems of recruitment. I am convinced that dealing with personnel issues is key for the creation of a professional army and enhancing its combat ability. I urge you to be more exacting in selecting personnel to serve under contract as sergeants and soldiers. We must provide incentives to attract the most prepared and capable men to serve in the army under contract. And the incentives must of course be above all financial, but not only that. They should promote the careers of young and promising personnel.

The task in this field has been formulated and it is well known: by the end of 2007, half of all army personnel must serve under contract. That in turn will enable us to reduce the term of conscript service to one year.

Additionally, we need a qualitatively new approach in organising educational work. It would be absurd to expect that the old and often purely formal methods of training and indoctrination would yield the necessary effects in dramatically changed conditions.

Military discipline and morale, of course, depend greatly on proper educational work. But there is another side to the issue, and that is respect of the law, strict adherence to military order and regulations. I must note that this year, as a result of the concerted efforts of the entire officer corps and the efforts of the Military Prosecutor’s Office, we have managed to stabilise the situation and improve law and order in army units. This trend must be continued.

And finally, we need an integrated modern system of training personnel for all the military institutions that are responsible for the security of our state. Closer coordination is needed between the ministries and agencies on matters of military planning, the control of the military organisation and implementation of the military-technical policy.

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We plan to continue the work to create a modern system of social security in the armed forces that is in line with the new economy.

As a result of the measures taken, military salaries have almost doubled. But we must also seek new approaches to deal with the problems of housing, medical care, the retraining and employment of former servicemen.

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In conclusion, I would like to stress that the Russian Armed Forces have a great potential – human, technical and intellectual. It is a solid basis for the successful implementation of the most ambitious plans of military development.

All our measures in this field are designed to strengthen the security of our country, ensure our sustained development, stable life and work for the citizens of the Russian Federation, economic growth and strengthening of Russia’s position in the world.

Thank you.