Greater changes to the Cabinet are yet to come

The much-anticipated restructuring of the government has failed to happen. The major changes in the Cabinet are the appointment of the new prime minister and Alexei Kudrin’s promotion. Will the government be more effective now, or is this only the start of some more extensive reforms?

The restructuring of the government, so greatly anticipated by politicians and experts, has failed to happen. The major changes in the Cabinet are the appointment of the new prime minister and Alexei Kudrin’s promotion. The changes affected only the problem areas that had been apparent to everyone. So will the government be more effective now, or is this only the start of some more extensive reforms?

Informed sources maintain that the latest changes are only the first step toward the government’s new structure. All the same, no further changes are planned in the immediate future. There are the elections to get through first. The main point that the latest changes are intended to demonstrate is a reinforcement of the Cabinet’s liberal direction.

The composition of Viktor Zubkov’s Cabinet has turned out to be both unexpected and entirely predictable. Most forecasts, including our own, predicted that Mikhail Zurabov and Vladimir Yakovlev would be dismissed, since they were clearly failing to cope with their responsibilities. And everyone knew that Herman Gref had been requesting permission to resign for some time. Now he’ll be able to devote more attention to his young family – and earn a higher income, if he moves into the private sector. Perhaps a place may be found for him in one of the new state corporations.

The completely unexpected developments are Dmitri Kozak’s return to Moscow, and the appointment of two women to the Cabinet. And the greatest surprise of all is that some serious structural decisions have not been made.

Zubkov himself said on several occasions that he doesn’t like the results of the state administration reforms launched in 2004, which involved subordinating federal services and agencies to ministries. This has made the structure of the government more complicated and less manageable. Prior to the president’s announcement, all the experts, politicians, and journalists were guessing how the Cabinet’s structure would change, not who the new ministers would be. But they were disappointed: the structure of the Cabinet has hardly been changed at all.

True, the government has gained two committees: fisheries and youth affairs.

So the long-suffering fisheries committee is back, rising like a phoenix from the ashes. It has appeared and vanished numerous times in the history of the Russian (and Soviet) state. Sometimes the state would announce that fish could keep the whole country fed, and declare the State Fisheries Committee a priority; but then it would turn around and give everything away to the Japanese and Norwegians, who have grown rich from fishing along our coasts. Now the State Fisheries Committe is being revived again, and this is entirely understandable: President Putin has made several comments recently about the fishing industry’s problems.

The Youth Affairs Committee situation is also understandable. It’s hardly a new invention; it has existed for a long time, and its present incarnation may be explained as concern for the younger generation of voters (harassed by all kinds of youth movements like Nashi and Mestnye), or the president’s consistent demographic policy: after all, Russia can’t boost its birth-rate unless young people are provided with housing, employment, and education.

The two new committees won’t really change anything in the government’s operations. Their impact may be symbolic: three years ago, the state administration reforms made a special point of abolishing committees. There are unlikely to be any fundamental changes at the Health and Social Development Ministry; the new minister, Tatiana Golikova, will first have to sort out this gigantic and ill-managed structure so as to restore order in its finances. That, in itself, would be no small achievement.

There have been two important changes to the government: the new prime minister himself, and some reforms to the economic bloc. In contrast to Mikhail Fradkov, Viktor Zubkov is a tough, authoritative leader. He’s likely to put a stop to conflicts and arguments between his ministers, and he won’t let them get away with failing to carry out instructions.

The Cabinet’s economic bloc will be changed radically. There won’t be any more disputes between the Economic Development Ministry and the Finance Ministry, like the disputes which have paralyzed decision-making repeatedly in recent years. Alexei Kudrin, now a deputy prime minister as well as finance minister, will be in charge of everything. And Elvira Nabiullina, the talented economist who is replacing Herman Gref, will be subordinate to Kudrin. So yet another hotbed of instability in the government has been suppressed.

According to our sources, the Economic Development Ministry took on too many powers and responsibilities when Gref was the minister. Now the Ministry’s functions will be effectively reducted to statistics and forecasting. All the same, according to Kremlin administration sources, Nabiullina will be one of the key ministers, and she will always attend the president’s Monday meetings with Cabinet ministers.

Thus, the main effect of the government reforms has been stabilization. That’s not enough, of course, but in overall terms the Cabinet will become more effective.