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. Last Updated: 07/27/2016

Yakovlev Has First Cabinet Meeting

President Vladimir Putin presented new Deputy Prime Minister Vladimir Yakovlev to the Cabinet on Tuesday with a warning that he was undertaking what could be the most daunting task of his career.

Putin on Monday appointed the St. Petersburg governor as a sixth deputy prime minister with a portfolio to overhaul construction, transportation and the collapsing housing sector.

Yakovlev comes to his new job with a lackluster record. During his seven years as governor, St. Petersburg's image as the beautiful imperial capital has been stained by its ever-worsening roads, crumbling buildings and widespread reports of corruption and organized crime.

Putin on Tuesday urged Yakovlev to get right to work and asked the Cabinet and the regions to help him tackle the enormous job ahead of him.

"There are going to be some serious changes in the areas that the new deputy prime minister is in charge of," Putin told the Cabinet.

The housing and utilities sector "is one of the most complicated areas and is a very tense social issue," Putin said. "From an administrative point of view, this area is twice as complicated."

The communal housing system -- the maintenance and repair of buildings and the supply of basic services such as water, electricity, heat, gas, sewage and garbage -- is on the verge of collapse after being virtually ignored by the government for decades. Up to 90 percent of the infrastructure of some regions is beyond repair. Tens of thousands of people are left without heat every winter.

Moreover, the whole system is teaming with corruption and, with local governments having free rein to run the sector, the federal government has not been able to muster enough authority to clean house.

While the government is not ready to turn the sector over to private firms, it is willing to let a consortium of powerful businesses -- led by state-controlled monopolies Unified Energy Systems and Gazprom -- share the burden and reap the possible profits.

"Our largest companies are paying special attention to the housing and utilities sector," Putin said Tuesday. "Their attention to this issue is being taken ambiguously by the public, experts and regional administrations, but to me it is a positive sign that large companies are paying attention to this part of our lives."

Putin also told the Cabinet that he hoped the government agencies that deal with transportation would "all collaborate respectfully" under Yakovlev.

"For the country's economy and the country's development, this area is of high importance. There are a lot of intertwining interests among the different ministries and bodies," Putin said.

Yakovlev faces a potentially uneasy job dealing with the Railways Ministry and the Transportation Ministry, which have often refused to work with each other. Prime Minister Mikhail Kasyanov issued a warning to senior officials at both ministries late last year, saying their turf wars had created havoc in the nation's cargo transportation system and was threatening to dent economic growth. The government has long planned to unite the ministries, but the project has been slowed by the sheer scale of the task and an ongoing revamp of the Railways Ministry. The railroads are being spun off into a state-owned company, and Yakovlev will oversee this process in his new post.

"I think he will succeed," Kasyanov said Tuesday. "Yakovlev has vast experience from being the governor of such a big city, and I am counting on him doing a constructive job."

Yakovlev's likely successor as St. Petersburg governor, Valentina Matviyenko, wished Yakovlev luck on Tuesday and urged him to "reveal his maximum potential," Interfax said.

A government source said an office was being prepared for Yakovlev in the White House. "Yakovlev possibly will turn up in the office Thursday and attend the Cabinet meeting," the unidentified source told Interfax.

Deputy St. Petersburg Governor Alexander Beglov is filling in for Yakovlev until a new governor is elected. The city's Legislative Assembly is to set the election date next Wednesday, Interfax reported. Central Elections Commission chief Alexander Veshnyakov said the vote likely would be held in late October or early November.

Yakovlev leaves St. Petersburg at a time when his popularity ratings are at a low of 20 percent from 74 percent in 2000. He has few major achievements to boast about during his time in office, and the biggest of them, arguably, was the city's recent 300th anniversary birthday bash, which was largely funded with $1.5 billion in federal money. In a sign of the corruption that continues to plague the city, the Audit Chamber found that $30 million of the money was misspent or went missing.

Yakovlev said little at the Cabinet meeting Tuesday. He told Kommersant in Tuesday's issue, however, that the appointment had caught him off guard. He said he had been in talks with Moscow for some time about getting a new post, but not the one he had received. He did not elaborate.

Putin said Monday that discussions about the appointment as deputy prime minister started "long ago."

Economic Development and Trade Minister German Gref said Tuesday that the news of Yakovlev's appointment had not come as a surprise to him.

Gref also said that in five to six years St. Petersburg "might become self-sufficient, and the new gubernatorial elections must kick-start this process," Interfax reported.

Matviyenko, who is Putin's envoy to the Northwest Federal District, said Tuesday that a plan to transfer some of Moscow's functions to St. Petersburg might be completed by the end of this year. Early this year, she said the juridical branch should be moved to St. Petersburg.

She also said Tuesday she has not decided whether she will run for governor.

Yakovlev's abrupt departure gives Matviyenko an advantage over other potential candidates, who were not ready for the election campaign to start half a year earlier than planned, analysts said.

Alexei Musakov, head of the St. Petersburg Political Center think tank, said Putin was making "a logical and pragmatic move" with Yakovlev's appointment. "Putin chose Yakovlev because he has never let him down and, just like in 1999 and 2000, he will have to prove his political and economical efficiency," Musakov said.

"Maintaining the heating supply and a system that is in catastrophic condition in a pre-election year is the most important political issue at stake," he said. "Putin's re-election hangs on this issue."

Yury Korgunyuk of Indem said Putin has managed to kill two birds with one stone: "Yakovlev is switching from the governor's to the deputy prime minister's seat, which is not a shameful move for him even though the Cabinet will probably be replaced in less than a year. And this opens the door for Matviyenko, which is in the Kremlin's interest."