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Medvedev: Monopoly tariffs freezing should not cut sound investment programs

Russia's Prime Minister noted that in the conditions of increased competition, the key factor of ensuring competitiveness of Russian companies is reducing their costs

MOSCOW, September 27 (Itar-Tass) - Limiting the growth of tariffs of infrastructure monopolies should not lead to cutting sound investment programs and violation of the rights of consumers of these companies’ services, Russian Prime Minister Dmitry Medvedev wrote in an article published by the Vedomosti newspaper on Friday.

“The government has decided to abandon the indexation of tariffs of the basic infrastructure monopolies in 2014, then - for two years in a row - it is planned to index these tariffs adjusting them to the current inflation level. But it must be done without cutting sound investment programs, that is, without violating the rights of consumers of services of infrastructure monopolies,” stressed the RF government head.

He noted that in the conditions of increased competition, the key factor of ensuring competitiveness of Russian companies is reducing their costs. “The most important line of work here concerns the infrastructure monopolies’ tariffs, and the issue is very difficult. But hardly anybody can argue with the fact that high tariffs impede the work of the majority of Russian businesses, hamper economic growth,” Medvedev writes. The prime minister stated that there would be a transition to long-term tariff setting principles, and budgets of the largest monopolies will be taken under public control. At the same time the tariffs and prices of most other infrastructure companies (in the housing and public utilities sphere, in the telecommunications industry and in the passenger transport sphere) would be indexed in the coming years according to the “inflation minus” formula. “The parameters of such indexing can be different depending on the initial situation, and under the influence of some structural solutions, including the minimization of cross-subsidies in the electric power sector, the gradual liberalization of the natural gas market and the introduction of the social norms of consumption of certain public services, the modernization of postal services,” explained the head of the Russian Cabinet.

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