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President Vladimir Putin: Good afternoon, dear colleagues.

We are here to discuss the state of work on creating a new executive body, the Federal Agency for the Supply of Arms, Military Equipment and Material.

We have been talking about this for a long time and the Defence Ministry took the necessary steps already two years ago now to enable this agency’s creation.

I remind you that the agency’s main responsibilities will be placing defence procurement orders for the supply of goods and the provision of work and services, concluding state contracts with the companies fulfilling defence procurement orders, ensuring financing for the state contracts that have been signed, overseeing and registering the fulfilment of these contracts and implementing a common price policy with regard to defence procurement orders.

This is a very big undertaking and the state is putting a very large amount of money into it. We have programmed the allocation of considerable material resources for carrying out the programme to develop our armed forces. Practically all of this will go through the new agency.

Mikhail Yefimovich [Prime Minister Fradkov], I know that the Government has done a lot to enable this issue to be settled.

Mikhail Fradkov: Yes, Vladimir Vladimirovich, on your instructions we have examined this issue and drawn up a draft decree on the agency’s creation and we are examining it within the context of the plan that I have reported to you about on several occasions already on clarifying the government’s structure and functions.

I ask you to come back to these Government proposals, all the more so as yesterday, at the press-conference as far as I understood it, you gave our work a positive assessment and thus essentially gave the Government carte-blanche for its plans over the coming months. This gives us renewed confidence.

We will make necessary adjustments to our priorities and concentrate our attention on the Government’s main areas of work, and we will do all we can to achieve the objectives before us.

But this requires certain clarifications to be made to the Government’s structure and we also need to settle a number of personnel issues. So, I ask you to please come back to this, Vladimir Vladimirovich.

Vladimir Putin: Good, Mikhail Yefimovich. I understand then that you have no objection to these structural changes?

Regarding broader changes, I have no objection. You know my view, but we will discuss this matter in more detail later.