- it introduces a clear division of tender and non-tender methods of procurement (quotation analysis, purchases from the single supplier (contractor);
- the draft law more clearly defines the provisions regulating the placement of orders on the tender basis, among which are the procedures governing the formation of tender commissions, requirements concerning the contents of tender documents, interpretation and changes in the tender documentation, assessment and drawing up of tender offers, the procedures governing the drawing up of tender protocols.
The new draft law defines the terms “state and municipal needs” and the “state and municipal customer.” The legislation currently in force fails to clearly define these terms in a number of cases.
Besides, we believe that the draft law justifiably removes the present tight constraints on attraction of foreign suppliers as concerns the procurement of products for state and municipal needs. According to the new draft law, in the course of placement of orders for procurement of goods, works, and services for state and municipal needs the goods (works, services) of foreign origin should be subject to national treatment with the exception of cases where the states or groups of states maintain any prohibitions or restrictions on goods (works, services) of Russian origin.
The draft law changes the minimal term set forth by customers with respect to presentation of tender offers for open tenders: in stead of 45 days this term is set at 30 days. The introduction of this term is related to the fact that in a number of cases longer terms are unpractical (for instance, as concerns tenders for placement of simple goods). From our point of view, this approach is not quite correct, since the term of presentation of tender offers in this case should be differentiated depending on the type of procured products.
It should be noted that in the case this draft law is approved, it will be a qualitative leap in the development of the Russian legislation concerning state procurement, since the provisions introduced by the draft law are based on the best international practices in this sphere.
The meeting of the RF Government held on May 20 of 2004.
At the meeting of the RF Government held on May 20, 2004, there was discussed the draft law “On measures aimed at the establishment of accrual mortgage system ensuring provision of housing for servicemen and their family members.” This draft law is aimed at the legal regulation of relations pertaining to the formation, specifics of investment, and utilization of funds for provision of servicemen and their family members with housing, state support of housing provision for servicemen by the method of accumulation of funds at the expense of the state budget and support of paying capacity of servicemen in the framework of mortgage based crediting.
The draft law determines the categories of persons entitled to participate in the cumulative mortgage system. It should be mentioned that the draft law regulates the most important issue of participation of graduates of vocational education establishments, who made contracts for military service prior to the beginning of the operation of the system, in the cumulative mortgage system.
The draft law envisages that in certain cases servicemen and their family members should be entitled to utilize their housing savings put on the personal cumulative account notwithstanding if they have permanent resident housing. This provision presents the possibility to equalize the social rights of servicemen and, according to the intent of the authors, should enhance the motivation for contract service in the armed forces by provision of the possibility to improve housing conditions of the servicemen already having permanent resident housing at the expense of additional funds provided to them in the framework of the system.
The possibility to purchase own housing by servicemen by the way of the use of the instruments of mortgage based crediting at any time after the expiration of a three year period of participation in the cumulative mortgage system prior to the discharge from the military service, as well as the possibility to choose the place of residence and the size of housing are a new form of realization of the servicemen’ right for housing.
The advantages of the cumulative mortgage system in comparison with the present system of provision of servicemen with housing is that the funds allocated for the settlement of the housing problem are distributed on the target basis, and that quality of purchased housing depends on the length of service in stead of the need in housing. At the same time, the process of formation of the funds aimed for purchase of housing is controlled both by federal executive authorities employing servicemen and servicemen themselves.
The replacement of the present system of housing provision with the cumulative mortgage system will allow to abolish the in kind form of provision of housing by monetary payments to servicemen.
The basis for the creation of the cumulative mortgage system is the long term character of the military service (15 to 20 years on the average) and provided by the budget target assignations for accumulation of funds on personal cumulative accounts of servicemen specifically designed for the consequent purchase of housing. Taking into account the fact that the system shall begin to operate since 2005, the 17 year long period of participation in the cumulative mortgage system was set forth as the base period of accumulation of sufficient funds for purchase of housing.
Servicemen are entitled to choose between the mortgage based crediting and the cumulative system basing on the long term forecasts of growth in prices of housing and profitability of the placement of savings.
In the framework of the proposed cumulative mortgage system, the choice of the mortgage based crediting will be justified in the case the rate of interest on the mortgage credit will be below or at the rate of growth in prices of housing. In 2003, the rate of interest on mortgage credits made 15 per cent in Rubles, i.e. inflation plus 3 per cent per annum. In 2005 and later it is expected that this rate will be reduced in accordance with the reduction of inflation rates.
According to the authors of this draft law, the forecasted conditions of the social and economic development and at the estimated real profitability of investment (3 per cent), mortgage based crediting is a sufficiently effective instrument for the settlement of the housing problem in the framework of the recommended cumulative mortgage system both for servicemen and the federal budget.
For the purposes of optimization of the mechanism of utilization of budget funds and meeting of budget obligations, as well as minimization of organizational expenditures, it is proposed that the functions pertaining to realization of the cumulative mortgage system of housing provision for servicemen should be transferred from the federal executive authorities employing servicemen to the federal executive authority ensuring its functioning.
The meeting of the RF Government held on May 27 of At the meeting of the RF Government held on May 27, 2004, the RF Minister of Economic Development and Trade German Gref presented the report “On the forecast of the level of prices (tariffs) on the products (services) of natural monopolies in 2005.” The main aim of the state regulation of prices (tariffs) on the products (services) of natural monopolies for this period should be the pursuit of a balanced tariff policy, which could ensure:
• achievement of targeted inflation parameters and reduction of the negative impact of growth in prices (tariffs) of products (services) of natural monopolies on the rates of the economic growth;
• the level of tariffs (prices) sufficient for the operation of natural monopolies.
The parameters of the increase in the regulated prices (tariffs) for the period of forecast should create incentives not only for reduction of costs borne by natural monopolies, but also facilitate the optimization of the energy balance and create incentives for transparency and introduction of the principle of separate accounting depending on the types of activities, as well as stimulate producers to more efficiently utilize the products (services) of natural monopolies, reduce the volumes of consumption of these products (services) to the levels observed in developed economies.
Natural gas prices The increase in natural gas prices at the rates, which in 1999 through 2004 outpaced the rate of inflation, permitted to make profitable the domestic natural gas prices. These measures allowed to partially cover the need for investments at the expense of profits derived on the domestic market. However, the domestic prices still do not allow to cover the full amount of investment necessary to meet the requirements pertaining to the maintenance and development of the infrastructure oriented towards the domestic market. The RF Ministry of Economic Development proposed to set forth the following marginal rates of increase in the average wholesale consumer prices of natural gas in 2005 and 2006: 20 per cent in 2005 and 11 per cent in 2006.
According to the preliminary estimates, the increase in the level of wholesale price of natural gas in and 2006 within the parameters indicated above will not result in a significant growth in costs borne by major consumers of natural gas, first of all, electrical power enterprises, what could permit to restrain the growth in energy tariffs, which have the most considerable impact on the growth in the costs borne by consumers. Thus, the increase in the natural gas prices in 2005 will result in the growth in costs in industry at large by 0.92 p. p. (in 2004 the increase in costs is estimated to make 0.77 p. p.). On the whole, the growth in the natural gas prices in 2005 will cause a rise in the costs borne by electrical power engineering by no more than 4.3 p. p. As concerns other industries, the growth in costs is expected to be rather insignificant – about 0.4 p. p. on the average.
Over this period, there should be continued the improvement of the mechanism of territorial differentiation of wholesale prices of natural gas and adjustment of the levels of wholesale prices in each price zone to the economically justified costs for extraction and transportation of natural gas from its deposits to consumers in the Russian Federation. In 2004, there should be taken a decision concerning an increase in the number of price zones, what may permit to reduce the scale of cross subsidizing of the zones situated in the European part of the Russian Federation at the expense of zones located closer to the deposits of natural gas.
Electrical power engineering The growth in the tariffs in the electrical power engineering has the most significant impact on the costs borne by consumers, inflation rates, and the rates of economic growth. In order to ensure the reduction of inflation in 2005 through 2006 to the target values, the rates of growth in tariffs in electrical power engineering for end consumers should be at or below the inflation rates forecasted for the respective year. On the condition that the growth in tariffs on electrical power for end consumers in 2005 will outpace inflation rates (8.5 per cent) by no more than 1 per cent (due to the increase in the prices of natural gas in 2005), the prices of industrial products will increase by only 0.75 p. p. as compared to 0.9 – 1 per cent registered in 2004 and 1.7 per cent observed in 2003.
As concerns the most energy intensive industries, mostly export oriented ones (ferrous and non-ferrous metallurgy, a number of industries relating to chemistry and petrochemistry), there the increase in costs will be below 2 per cent to 3 per cent, therefore they remain competitive and the increase in costs will have no significant negative impact on the investment potential.
In this period, there should be continued the formation of a competitive market of electrical power. The development of the competitive environment in the electrical power engineering alongside with the caps on tariffs should ensure a reduction of costs borne by the industry.
Tariffs on railroad freight Taking in account the fact that the contribution of tariffs on transportation in the prices of raw materials and intermediate products is rather significant, the growth in tariffs on railroad freight in the period of and 2006 should be moderate. This will allow to constrain the negative impact of increase in tariffs on consumer of railroad services, while ensuring the sufficient level of profitability in this sector. According to the estimates, the justified growth in tariffs should be at the target inflation rates for the respective period. In the period of 2005 and 2006, in the railroad transport there will be continued the creation of prerequisites for the development of a competitive environment by the method of separation of non-regulated types of activities, where tariffs should be formed in the market environment. Over the period included in the forecasts, the withdrawal from the structure of railroad transport and privatization of state owned enterprises not directly linked to organization of traffic and rendering of maintenance and repair services will continue. The objects pertaining to the social sphere should be transferred to the balances of RF subjects and municipal entities. In 2005, the increase in tariffs on railroad freight within the inflation rates will result in the aggregate growth in the costs borne by industrial consumers by 0.17 p. p. (0.25 p. p. in 2004).
*** The rates of growth in prices (tariffs) of the products (services) of natural monopolies presented in the report correspond to the macroeconomic indicators approved by the RF Government and permit to attain a number of key objectives set forth by the state, at the same time not infringing on the interests of natural monopolies. The main results of implementation of the proposals discussed above may be presented as follows:
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