OREANDA-NEWS.  The meeting, which took place in Ivanovo, examined implementation of new laws on local government.

Before the meeting began, Mr Putin visited the exhibition Best Municipal Practices in Ivanovo Region. Successful projects presented to the President included a city water supply and management project, the Volga Riviera inter-city tourism project, and an industrial park, Rodniki.

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PRESIDENT OF RUSSIA VLADIMIR PUTIN: Good afternoon, colleagues and friends.

Last year, in my Address [to the Federal Assembly], I named modernisation of the local government system as one of our priority tasks. This is an issue we have come back to repeatedly and have discussed often. Looking back at local government reform over history, we see that today, as in 1864, when the famous reform establishing the zemstvo [local government bodies] was carried out, the time is ripe for transformation at the local government level. We hear this from members of the public, experts, local government representatives and State Duma deputies.

The problems and imbalances in the local government system are clear to all. The proposed changes aim to remove these disproportions and generally raise local government’s role and independence, bringing it as close as possible to the local people.

I know that a lot of work went into drafting the laws that we are going to discuss today. The Congress of Municipalities and the National Council for Local Government were actively involved in this work, as were municipal representatives and the academic community. Political parties and the professional community also stated their views. Discussions were held in the regions, in the federal Parliament and in the media.

Local government issues are indeed at the centre of public attention. What is important is that through broad-based dialogue we succeeded in achieving greater consensus between practically all parties concerned. I particularly stress this point and hope that my colleagues who were involved in this work will continue to organise it in just this way. Quality system-wide proposals were drafted and became the basis for the draft law. This law has been passed by both houses of the Federal Assembly, and I want to inform you that I have signed it.

In fact, the main reason for today’s meeting is to talk about this law.  I would like to hear your opinions about it. Then we will see how it is being implemented, what the legal practice of its application will be. This is a living organism and, if necessary, we can make amendments. We will see together how it is working.

I am certain that you know it well, but today I would like to dwell on it in detail, beginning with the organisation of the local government system. In larger towns and cities it did not fulfil the purpose this level of authority was intended for, and in many cases residents did not know their representatives in the municipal councils.  Meanwhile the municipal level of authority is the one that is nearest to all citizens, it should always be on hand – I spoke of this on numerous occasions, and experts mention this often as well.

What is the public attitude to municipal councils, what has it been like up to now? We have conducted several polls. In particular, the Public Opinion Fund held a poll in May 2014.  For your information, 79 percent of people in cities with a population of over 1 million do not know the officials who represent their constituency in the municipal body of representative authority. In cities with a population between 250,000 and 1 million, the number is 76 percent. This is slightly lower than in the million-strong cities: 79 and 76 percent, but it is still much too high. In towns with a population from 100,000 to 250,000 – a relatively small community in our scale – 73 percent of the residents do not know their deputies. Therefore, in the new version of Law 131 another model of municipal authority organisation has been added to the existing ones, one that meets the demands of our times.

Allow me to say a few words about its purpose. The adopted amendments envisage the possibility of creating new types of municipal formations in large cities – a city precinct that is further divided into city districts. I would like to stress here that these norms are not imperative; they are not imposed on anyone and are not mandatory. This is yet another option you can choose, one more scenario in addition to what has been functional so far.

Every specific area should decide for itself how to arrange its local authority, which form of local government would best suit the interests of its residents, whether they will elect the head of their municipal formation by means of direct vote or will prefer to delegate this authority to the municipal representative body of power which they themselves have elected.

To make this absolutely simple and clear not only to us, but to the people: you can elect the council, say, of a large city divided into districts by direct vote, and you can do it by district, while the district deputies delegate their representatives to the higher body of power to form the municipal representative authorities.

I would like to stress that legal opportunity is being created to bring the municipal authorities in big cities as close to the population as possible, close to their issues, so that the people can take a direct part in resolving local issues using the territorial public government as well.

This would also increase the elected representatives’ responsibility to their citizens: they will have to spend much more time on the ground, get personally involved in all the day-to-day matters and work directly with the people. In any case, the authors of this law would like it to be this way, and, frankly speaking, so do I. I believe this will reduce the time spent at meetings of city and district councils or speaking to the media. Though coverage of our work is also important.

I would like to note here that this gives the beginning politicians, specifically those from the non-parliamentary parties, and independent public activists regardless of their political views an additional opportunity to get elected to local bodies of authority, provided, of course, that they are truly focused on real work with the population.

Next. Strict division of authority is the cornerstone of the entire power structure’s stability. We have also considered this on many occasions. The main idea of this reform is to make the lowest level of local government more efficient, to delineate their responsibilities and determine what sources of funding our colleagues in the municipal councils will use to exercise their authority. The amendments made to Law 131 have fixed the key political issues, so to speak, the red lines of local government that cannot be crossed.

First, the lower level of municipal authorities will be assigned such powers and responsibilities that ensure autonomy and independence at the municipal level. This can be the management of municipal property, the formation and execution of the municipal budget, the structuring of local government bodies and so forth. In addition, they will have the powers that have been delegated exclusively to the representative municipal body, from setting local taxes to adopting development plans and programmes for the municipality and monitoring the performance of its officials.

Second, the amendments to Law 131 give regional authorities the right to redistribute certain powers between the federal region and the municipality. However, it simultaneously increases the regions’ responsibility for coordinated and productive cooperation with the municipalities. What this means is that there should not be any voluntary transfer of authority from one level to another.

Thus, decisions to redistribute powers with regard to a specific municipality should be fixed by a relevant law of the federal region, while the powers themselves are to be passed on only together with the financial means to exercise them. This allows for a differentiated approach to each municipal formation, makes it possible to take into account its development needs and labour and economic resources.

The region here has to guarantee stability of the established rules to the municipality, which I find extremely important. We cannot allow this approach and the rules to change time and time again. If the decision to re-allocate powers has been made – and I would like to stress this – it should remain in effect for the duration of the regional parliament’s term. This is a sort of joint liability agreement between the region and the municipality, and compliance with this agreement must never be influenced by personal relations between the Governor and the Mayor, political party affiliation, or any other transient factors.

It is of principal importance that the law on authority re-allocation should only come into effect at the start of a new fiscal year. This would rule out situations when in the course of one year the budget remains the same, while the municipality’s responsibilities are increased. I would like to note that the revenues and powers should be balanced within a single budget and tax policy. We are now finalising its main clauses. I expect we will get back to this today as well.

The regions are facing the difficult job of establishing the best local government model for their territories. It is important for everyone to understand here that the legal regulation system of local government in Russia rests upon the freedom of choice – this is something I have mentioned more than once and would like to come back to. We cannot impose anything; we must take into account the opinions of municipalities’ heads and local parliamentarians.

The primary task of regional heads now is to establish dialogue with municipal councils and communities to discuss all the substantive issues and subtleties of the reform. This dialogue should result in a law on the organisation of local government in the specific region of the Russian Federation. I believe six months should be sufficient to consider everything and pass the relevant legal acts in all the Russian regions.

In order to avoid conflict and shifting of responsibility we have to resolve the most acute issues now. Regions and municipalities should work as a team in the interests of developing their territories and raising people’s living standards.  I would like to stress that the choice of the best local government model should take into account each region’ needs, the ethnic traditions of the residents, and it is imperative to hear out the people. It is the participation of the public in decision-making that makes local government what it should be. Only by acting openly, in a democratic manner can we secure the implementation of the Constitution’s key principles – the independence of local government and the federal form of government in the country.

Together with the Ivanovo Region Governor, I have seen how work with the public is organised here. Overall, it is not bad and the experience of such regions as Ivanovo can be useful.

I suggest we get down to work and consider the mechanisms of implementing the new provisions of the law.