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. Last Updated: 07/27/2016

Yeltsin Dismisses His Entire Government

President Boris Yeltsin fired Prime Minister Viktor Chernomyrdin and his entire Cabinet on Monday, saying that the lagging job of economic reform needed "more energy" from a new team.

Yeltsin's bold stroke removed not only Chernomyrdin, a tough political survivor who has led the government for five years, but also Anatoly Chubais, the first deputy prime minister seen as the chief advocate of free-market economics.

Former Fuel and Energy Minister Sergei Kiriyenko was named acting prime minister, with the task of forming a new government.

Despite the personnel changes, the government's policies on economic reform remained unchanged, Yeltsin said in a televised address, and it appeared likely that some of the dismissed ministers would find jobs in the new Cabinet.

Many observers said the shake-up was less about policy and more about choosing a successor to Yeltsin, who is 67 and has suffered from a series of debilitating health problems.

Some commentators speculated that Yeltsin was setting Chernomyrdin to run in the 2000 presidential election. Others said he was throwing the succession struggle wide open after realizing the untelegenic Chernomyrdin, who has struggled with limited success to revive Russia's economy, could not win.

The decision came three days after Yeltsin returned to the Kremlin after spending a week recovering from a throat infection. Yeltsin, who underwent heart bypass surgery in November 1996, spent two weeks off work with another cold in December.

Yeltsin said in his address that Chernomyrdin, whom he praised for his loyalty, was "to concentrate on political preparations for the elections." But Yeltsin did not clarify that or say whether he was putting Chernomyrdin forward as his anointed successor.

Yeltsin's decision took Moscow by surprise, in contrast with last year's shakeup that brought in Chubais and Boris Nemtsov as first deputy prime ministers after a frenzy of speculation in the news media.

The awkward timing -- a summit with the French and German presidents is scheduled to take place in Moscow Thursday -- suggested the decision was made quickly. The Kremlin said the summit was still on.

Under the Constitution, the Cabinet will remain in place until a new government is named. Yeltsin has two weeks to submit a prime ministerial nomination to the State Duma, parliament's lower house, which must vote on it within a week. If the Duma refuses Yeltsin's candidate three times, the lower house would be dissolved and new parliamentary elections held. The president at first said he would take over the duties of prime minister temporarily, but later named Kiriyenko as the acting prime minister. Kiriyenko, 35, is a reform-minded politician who worked closely with Nemtsov in the Nizhny Novgorod region for several years. When Nemtsov, then governor of the region, was appointed to the federal government, he asked Kiriyenko to come to Moscow with him.

Presidential spokesman Sergei Yastrzhembsky said on NTV television that Kiriyenko was "the most likely, strong and possible candidate" for the permanent post, but parliamentary leaders said he would have difficulty winning approval in the Duma as a close ally of Nemtsov, who is not liked by the Communist opposition.

Other candidates figuring in news media speculation included Moscow Mayor Yury Luzhkov; provincial governors such as Saratov's Dmitry Ayatskov; Yegor Stroyev, head of the Federation Council, the upper house of parliament; Nemtsov; and Grigory Yavlinsky, head of the liberal Yabloko Party.

Yavlinsky said Monday he might take the job if it was offered under the right conditions, though he would probably have trouble winning confirmation from the Communist-dominated Duma, as would Nemtsov.

It appeared possible many ministers in the out-going government might find a place in a new Cabinet. The government said foreign policy would not change, and Foreign Minister Yevgeny Primakov strongly suggested he would be staying on, saying that if there were people who wanted him out, "I will have to disappoint them for the time being."

Gennady Seleznyov, the Communist speaker of the Duma, said Yeltsin should consult with the opposition about the new government. "Such consultations between the president and the leadership of the Federal Assembly will contribute to the consolidation of society," said Seleznyov.

But Yastrzhembsky said no such meetings figured in the president's schedule.

While most ministers will not have to clear their desks until replacements are named, Yeltsin, in his decree, ordered three to step down immediately: Chernomyrdin, Chubais and Interior Minister Anatoly Kulikov. Chubais has been nominated for head of the board of directors of the national electric monopoly, Unified Energy Systems, and his departure from government had been regularly predicted since he became involved in a book-fee scandal last fall.

Yeltsin's brief noontime address ignored foreign and defense policy and focused on the economy. He said ordinary people were not feeling benefits from the government's struggle to complete Russia's transition to a market economy.

The firings were "an effort to bring more energy and efficiency to economic reforms, to give them additional impetus," he said.

"Unfortunately people don't feel that changes are for the better," Yeltsin said. "I believe that recently the government has been lacking dynamism and initiative, new outlooks, fresh approaches and ideas."

"And without this a powerful breakthrough in the economy is impossible. In a word, the country needs a new team capable of reaching real, tangible results."

Yeltsin has repeatedly criticized his ministers for the government's failure to pay pensions and government wages on time, most recently over the weekend. In his state-of-the-nation speech Feb. 17, Yeltsin made paying wages and pensions one of the top priorities, and said that if it wasn't fulfilled, "we will have a new government."

Yeltsin let Chernomyrdin go with praise for his loyalty and hard work. "It is always not easy to say good bye to old comrades-in-arms," said Yeltsin. "Viktor Stepanovich has done a lot for the country."

Chernomyrdin, until Monday the longest-serving member of Yeltsin's Cabinet, seemed unperturbed by his dismissal, saying "this is not a disaster for me," and urging Russia's financial sector not to panic. "There is no crisis," he said. He remarked he had not decided about a presidential run.

Yeltsin said the basic course of economic policy would remain the same, but with new faces: "Resignation of the government does not mean any change in the course of our politics."

Nonetheless, he said the government should focus more on social welfare, though the new government will face the same problem the old one did: lack of money to pay for social benefits because of lagging tax collection.

Chubais said that reform would stay on course and that most of the ministers would retain their jobs. "The perspective for the reformers is quite good. It's even better than now," Chubais said at a news conference.