Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Minister Touts IOUs for Arrears




Sergei Kalashnikov, the first member of the ultranationalist Liberal Democratic Party of Russia ever to hold a Cabinet job, suggested a plan Wednesday to secure wage and pension arrears by offering veksels, or promissory notes, or some other government paper to those citizens owed money.


Kalashnikov, who is Yevgeny Primakov's new labor and social affairs minister, was quick to add that the prime minister probably would not back his proposal for liquidating a wage-and-pension arrears bill for the public and private sector, estimated by trade unions at 86 billion rubles ($6.6 billion at Thursday's official rate of 13 rubles to the dollar).


The sight of a prominent LDPR member in power f even in such an insignificant ministry f brought journalists racing to Kalashnikov's first news conference. But those who expected wild ideas along the lines of those usually offered by the faction's leader, Vladimir Zhirinovsky, were disappointed: Kalashnikov offered little in the way of excitement other than his veksels-for-wages scheme.


He also said that he cut all ties to the LDPR upon joining the government.


"Once you've got to work in the government, your political orientation does not matter anymore," said Kalashnikov, 47, who was previously a Duma deputy prominent at the lower house's Committee for Labor and Social Policy.


A graduate of Leningrad State University with a degree in psychology, Kalashnikov also worked on social and employment issues prior to joining the Duma, and once headed the International Association forProtection from Unemployment and Poverty.


Speaking about reports of a new wave of unemployment brought on by the ruble devaluation and the banking collapse, Kalashnikov said that media and officials had exaggerated the number of new jobless.


"This wave of unemployment is very peculiar. It consists of laid-off employees of the banking and investment sector, foreign companies, advertising and public relations agencies," Kalashnikov said.


He added that these middle-class professionals were not the sort of people likely to turn to his ministry for help.


Kalashnikov did offer a radical, if shaky, policy departure for the ministry: He announced it would no longer focus its energies only on the very poorest sector of the population and leave those lucky enough to have any kind of salary or pension at all to find for themselves.


Nor was he keen to talk about indexing pensions, even though by his own account, the dollar value of the monthly minimum pension has dropped from $70 to $33 while food and other prices have jumped two- or three-fold. Kalashnikov said the minimum pension put a recipient well below what state regulations consider a survival income, but he did not advocate raising it.


Aside from his veksel scheme, Kalashnikov had little new to say about unpaid wages and pensions. He repeated that they should be paid on time and said that priority should be given to meeting current payments, not catching up on back wages and pensions.


"Our task is to make sure that people get money to live on now, and not for the period they've already lived through unpaid," he said.


Kalashnikov said that due to a shortage of funds, the government is prioritizing who to pay first. Those who have not been paid for three months or more are first in line.