Among the social problems of the Armed Forces the problem of housing provision for the servicemen still remains one of the most serious. Now there are almost 140,000 families in the Armed Forces, needing the housing. 97,900 of them are homeless. Besides it is necessary to remove more than 80,000 families of the people, who lost their connection with the Defense Ministry, from the closed military installations. Plus, according to the State Statistics Committee, as of beginning of 1997 158,800 families of the servicemen removed to the reserve or retired, wait for receiving of housing in the place of residence, chosen by them.

To solve these problems within the military reform frames the special federal program “State Housing Certificates” (SHC) was developed. This program was developed in accordance with presidential decree of September 30, 1997, No 1062 “On improvement of procedure of the housing provision for the servicemen and some other categories of citizens” and approved by governmental resolution No. 71 of January 20, 1998. Presidential decree No. 102 of January 28, 1998, attributed the status of a presidential program to it.

On March 21 of 1998 the government approved resolution No. 320 “On measures for provision of realization of the presidential program “State Housing Certificates””. This decree regulated the organizational issues of the program’s realization in the defense Ministry, and approved the “Instruction about procedure of formation of lists for receiving of SHC and their issuing by the defense Ministry”.

On March 23 of 1998 the president approved the schedule of financing of the SHC program. It is planned to assign 5.1 billion rubles for its realization. 3.2 billion rubles of this sum are suggested to be assigned for provision of housing for the servicemen, removed to the reserve.

It is planned to carry out the program’s financing in 1998 on account of the federal budget funds equal to 2.1 billion rubles, allotted tot he Defense ministry for provision of housing to the servicemen, released from the military service within the military reform frames and from other sources.

President and the government announced that the program’s financing would not be sequestrated. Money from the large credit, recently received by Russia from Japan, will be spent for this program.

Reference: on account of the assigned 2.1 billion ruble sit is possible to receive 13,900 apartments in the interests of released servicemen under condition of repayment of 100% of the apartment value (151,200 rubles for an apartment on the average) or 17,400 apartments under condition of repayment of 80% of the apartment’s value (121,000 rubles for an apartment on the average).

On April 16 of 1998 a tender was organized, which defined the general manager of the program. It was consortium, including United Directorate for the Federal Investment Programs Fulfillment of the Gosstroi, open stock company Agency for the Mortgage Housing Crediting and Military Insurance Company.

On April 27 of 1998 the tender was organized for selection of commercial banks for participation in the program’s realization. 20 commercial banks participate din the tender. 9 banks were separated at the first stage, because they did not meet the selection criteria according to their economic parameters. As a result Sberbank occupied the first place, Incombank – the second place and Promstroibank – the third place. These banks, besides the other advantages, possessed broad networks of filial branches in the Federation subjects, which is an important factor of their choice as he authorized banks by the certificates holders.

After development of the set of the legal documents, regulating procedure of realization of the SHC program and organization of tenders for definition of the general manager of the program and selection of commercial banks we can speak about completion of the work on the mechanism of the program’s realization. Housing provision to the servicemen through the SHC will allow:

1) to accelerate solving of the housing problem by giving the possibility to purchase the ready-made housing in the market to the servicemen;

2) to give the right of the free choice of quality and location of the housing to the servicemen;

3) to strengthen control over spending of the budget funds, addressed directly to the servicemen;

4) economizing of the budget funds by increasing of the servicemen’s interest in the rapid receiving of housing and readiness to partially use their own and credit money;

5) to avoid freezing of the state funds in the uncompleted housing construction.

The SHC program plans housing provision to 42,000 families of the servicemen, released from the military service within the frames of the military reform and citizens, subject to removal from the closed military installations (overall 210,000 families) annually in 1998-2002.

The volume of the subsidies provided for the housing purchase by receiving and repayment of the SHC is defined proceeding from the federal social standard of the represented housing (33 square meters for 1 person, 42 square meters- for 2 persons, 18 square meters for each member of the family of 3 and more persons) and the average market value of housing in the region with the coefficient of 0.8, but not higher of the average Russian one.

Reference: resolution of the State Committee for Housing and Construction Policy No. 18-37 of April 16, 1998, established the average housing price in Russia as 2,800 rubles for 1 square meters of the total area as of April 1 of 1998. This value will be corrected every 6 months and published in the mass media.

Housing provision to the servicemen and servicemen, released from the military service, by issuing and repayment of SHC is new phenomenon, that is why the attitude of the servicemen to it is contradictory. Quite natural are the skeptical opinions about realistic character of this program’s fulfillment, fears of cheating, of issuing of “vouchers”, which are not supported by the real money and so on. On the one hand this program gives a range of advantages t the servicemen:

– first of all, it is possible to rapidly purchase the new housing;

– second, it is possible to chose, or, having added one’s own savings, to purchase a new apartment at a higher price or an apartment at a lower price in the secondary housing market;

– third, there are no mediators between the serviceman and housing seller;

– fourth, participation in the program is voluntary.

On the other hand, the servicemen receive not “cash”, not a real apartment, but a certificate “for the right to receive a subsidy”, which is not even a security. Many people are scared by the 6 month time of the certificate validity.

During this period the serviceman has to define the place of his residence, apartment area, fill in significant number of documents and take a range of other responsible actions, having avoided the frauds and criminal structures, which will for sure try to profit from this program.

Due to this the legal documents pay much attention to organization of work for explanation of provisions of this program tot he servicemen and servicemen, released from the military service, consultation and practical assistance to the citizens in filling of the documents for receiving of a certificate, in the choice of an authorized bank and apartment seller, in conclusion of a contract for the apartment purchase and so on. Along with this decree of the Defense Ministry No. 178 of April 16, 1998, “On measures for provision of realization of the presidential program “State Housing Certificates” in the Defense Ministry” especially stressed the voluntary character of the servicemen’s participation in the program. A serviceman, standing in line for the housing receiving, remains in it until the moment of the apartment purchase for a housing certificate.

For realization and control over procedure of issuing and repayment of the SHC, as well as for organization of the work on explanation of conditions and procedure of the program’s realization, in accordance with governmental resolution No. 320 of March 21, 1998, working groups were organized in administrations of the federation subjects. Commissions were organized, presided by deputy heads of administrations are organized by the district and city administrations together with the military commissariats for organization of the work, regarding issuing of SHC to the servicemen, released from the military service.

For realization of the program and practical assistance to the servicemen, the working group was organized in the defense Ministry, in accordance with the Defense Minister’s order, subordinated to commander of construction and deployment of troops, Deputy defense Minister. In commands of the Armed Forces branches, military districts, fleets, in department of the Airborne forces commander, in the main and central departments of the Defense Ministry working commissions are organized for this purpose under leadership of first deputies of the corresponding officials.

The commissions include representatives of the ideological organs, organizational-mobilization, personnel, financial-economic and apartment-operational organs.

In the Main Department of Military Budget and Financing of the defense Ministry a corresponding sub-unit was organized for fulfillment of the program. These working groups and commissions have to provide informational and consultation assistance to the servicemen, regarding the program fulfillment. In the emergency cases it is possible to receive the necessary information on phones No. 2935514 and 2938733 of Moscow city line.

Thus, to avoid mistakes and misunderstandings participant of SHC program has:

1) to study the legal documents, observe demands about procedure of issuing and repayment of the SHC;

2) to avoid services of the intermediary banks and commercial organizations, which are not participants of this program, and consult in the military control organs and local administrations about all problems.