Pitfalls of the army housing program

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The Defense Minister keeps actively working to solve the social problems of servicemen. Thus, on January 30 the Defense Ministry held a meeting dedicated to the progress of the program for the construction of housing for officers and warrant officers under supervision of Deputy Prime Minister and Defense Minister Sergei Ivanov. The main topic of the meeting was the summing up of the interim results of the presidential housing program “15+15” that provided for the construction of 18,500 apartments for officers and warrant officers between 2007 and 2008 in five problematic regions, namely Moscow, Moscow Region, Leningrad Region and Kaliningrad. Representatives of the Defense Ministry said that the meeting included reports for the Director of the Federal Construction Agency Sergei Kruglik, director of the quartering and accommodation service of the Defense Ministry General of the Army Anatoly Grebenyuk, Moscow Mayor Yury Luzhkov, Governor of the Moscow Region Boris Gromov, Governor of St. Petersburg Valentina Matvienko, Governor of the Leningrad Region Valery Serdyukov and Senior Deputy Governor of the Kaliningrad Region Yury Shalimov. Mass media aggressively covered this event and almost every report emphasized that the presidential program was progressing according to plan.

According to Grebenyuk, in 2006 “we received 6,402 apartments under the “15+15” program. In 2007, it will be necessary to build the remaining 12,100 apartments called for under the program. This is not much in the overall structure of housing plans. In 2007, the Defense Ministry plans to receive more than 42,000 apartments including:

– 8,100 apartments under the Defense Ministry’s own plan;

– 12,100 apartments under “15+15” program;

– 8,700 apartments under “State housing certificates” program;

– 3,500 apartments under investment contracts;

– 8,400 apartments through repeated use of vacated housing;

– 1,500 apartments through the relocation of servicemen from Baikonur cosmodrome.

Of course, this is a process. There has never been such a large volume of construction for servicemen in post-Soviet history. However, even these volumes are insufficient to solve all the housing problems of the Armed Forces. At the consultation it was announced that as of January 1 of 2007, 139,000 families needed housing in the Armed Forces, including:

– 52,800 families having no housing for permanent residence;

– 15,700 families needing an improvement of housing conditions for permanent residence;

– 55,000 families needing service housing;

– 15,500 families needing an improvement of housing conditions (service housing).

This data enables the observers to draw the conclusion that even taking into account large-scale housing construction in 2007, the quantity of people in a queue to get housing will amount to about 100,000 people. How will the housing problem be solved for them between 2008 and 2010? For this very period, President Vladimir Putin set the task of definitively solving the housing problem in the army.

Sergei Ivanov is already concerned about the achievement of this goal. At the consultation he proposed prolonging financing of the housing program “15+15” until 2010 (with reception of no less than 9,200 apartments annually). Along with this, Ivanov stresses that it is necessary to broaden the geography of the program, including other regions having unfavorable proportions of permanent housing provisions to servicemen.

Among such regions are, for instance, the Rostov, Volgograd, Samara, Novosibirsk, Chita, Sverdlovsk, Nizhny Novgorod and Smolensk regions, Primorsky and Khabarovsk territories. In these regions there are 18,100 servicemen needing permanent housing including 12,500 servicemen having no housing at all.

Participants of the consultation were informed that in the framework of preparation of the draft for the federal budget for 2008-2010, the Defense Ministry already worked out and submitted to the Finance Ministry and Economic Development and Trade Ministry proposals regarding prolonging the program. So far, these ministries did not respond to the proposal of the Defense Ministry. This response is unlikely at any rate, since the Finance Ministry is averse to increasing defense expenditures on top of the level of 2.6-2.7% of the GDP. According to analysts, solving the housing problem on the scale currently proposed by Ivanov will require no less than 180 billion rubles. This means that during the period remaining until 2010, financing of housing construction for officers should account for 12-15% of the overall annual military budget of the country. Only then will the annual share of military expenditures be no less than 3.2% of the GDP, which the government and the President object to so far.

Of course, this issue will be hushed up in the election year. Another president of the country will report about the results of the housing program in 2010. Thus, it is likely that the queue of officers having no apartments will hardly disappear in the Russian Armed Forces by 2010.

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