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Analysis: Russia's Government -- Manufacturing Accountability

Russian Prime Minister Mikhail Fradkov cut his Sochi vacation short -- reportedly at the personal insistence of President Vladimir Putin -- to preside over a 12 August cabinet session devoted to the subject of government accountability. Ministers at the meeting were sharply divided over the results of the work of an administrative-reform commission headed by Deputy Prime Minister Aleksandr Zhukov.

According to "Izvestiya" on 13 August, Fradkov and Zhukov both emphasized in their presentations that Putin has been clear in setting the government's tasks: doubling gross domestic product (GDP) and cutting poverty in half. On the basis of these tasks, Zhukov's commission created a list of "objective indicators" by which the performance of each ministry -- and each minister -- may be judged. "Izvestiya" reported that the commission has not yet set indicators for the defense and security agencies, noting that these agencies were also restructured several months after the nondefense ministries were reformed earlier this year. The daily predicted that defense-sector indicators will be forthcoming after the 2005 budget is adopted.

The new indicators will, beginning with the 2006 budget, be tied to each agency's federal funding. An increasingly large portion of the budget will be directly tied to the government's main tasks through targeted programs that are funded across agencies. Those agencies, in turn, will have to justify their access to that funding by citing the indicators for which they are responsible. on 16 August cited Fradkov as saying that all government agencies will have adopted and submitted a strategic action plan by the end of the year.

"This in no way is the kind of planning that we had during Soviet times," Fradkov said, defending the initiative. "It in no way will limit the initiative of ministries and agencies in carrying out the tasks they have been set."

Zhukov told RIA-Novosti on 12 August that the new system is an elegant mixture of freedom and control. "In the framework of the reform of budgetary planning, ministers will be given great freedom in managing their budget resources and, at the same time, they will be made more responsible for fulfilling the tasks set for them," Zhukov said. He said that the introduction of the indicators "was done at [the ministers'] own request."

Zhukov added that the president and the government will decide the fate of any ministers who fail to achieve their performance targets.

"Nezavisimaya gazeta" on 13 August provided some details about the contentious discussion the ministers had about the specific indicators. For example, Zhukov's commission has proposed that the Health and Social Development Ministry be responsible with cutting infant mortality from the current 11.7 per 1,000 infants to six by 2012. The Finance Ministry, meanwhile, will be asked to see that stock-market capitalization rises from the current 47 percent of GDP to 70 percent by 2009.

According to "Vedomosti" on 6 August, the plan would hold the Finance Ministry responsible for boosting Russia's Standard & Poor's credit rating to A- by 2007, while the Economic Development and Trade Ministry would be primarily responsible for cutting inflation to an annual rate of 6 percent by 2007. "Vedomosti" reported that there are 58 indicators in all, including several that are shared by more than one agency. For instance, the Health and Social Development Ministry will work together with the Economic Development and Trade Ministry to see that the percentage of the population living below the poverty line is reduced to 12 percent by 2006 and to 10.5 percent by 2007.

Economic Development and Trade Minister German Gref and Finance Minister Aleksei Kudrin reportedly took issue with the indicators assigned to their ministries, arguing that they were not able to control all the factors that contribute to, say, inflation or production. "GDP growth and industrial production involve a huge number of factors, few of which we influence," Deputy Economic Development and Trade Minister Andrei Sharonov told "Vedomosti."

Not surprisingly, presidential economic adviser Andrei Illarionov, who is well known for his unrelenting criticism of several government figures, particularly Gref, endorsed the indicators. "This is a very serious document," Illarionov told "Rossiiskaya gazeta" on 13 August. "The goals, targets, and indicators presented in it seem ambitious and realistic."

While the program will certainly be revised over the next few months, there seems to be little doubt that it will be adopted. Fradkov is widely seen as the guiding spirit behind the initiative, and several media outlets attributed his early return from vacation to his desire to make sure that ministerial infighting over the reform did not get out of hand.

Moreover, Putin met for more than three hours with Zhukov on 11 August, a meeting that was given wide coverage on national television. During that meeting, Putin emphasized the role of the indicators in demonstrating the government's successes to the public. "I believe that [publicizing the indicators] would be eye-opening for our citizens," Putin said.

Putin's emphasis on presenting "objective figures" to the public seems to indicate that the government is concerned with the problem of accountability. At a 13 August press conference devoted to the topic of the first 100 days of Putin's second term, Center for Political Technologies Deputy General Director Boris Makarenko commented that during the president's first term, a new "system of power" was constructed and the second term will demonstrate how it functions. "[The system] works more effectively than the skeptics and pessimists expected," Makarenko said, according to "Moskovskii komsomolets" on 14 August. "But the other side of such a system is that it is beginning to evolve in the direction of increasing isolation from society; it is losing its connection with [society]. And closed systems always become dull, and they try to protect themselves from negative information."

The Zhukov commission's administrative-reform scheme would seem to be an attempt to build some form of accountability into this closed system -- replacing the oversight functions that an independent legislature, judiciary, media, and civil society would otherwise execute -- without, of course, fundamentally altering the system. It remains to be seen whether this system -- under which the government itself sets its targets, generates the indicators by which it is judged, produces the statistics by which the indicators are measured, publicizes or conceals its findings, and decides the fates of officials who miss their targets -- can do anything to stem corruption and to promote efficiency and innovation. Makarenko's "skeptics and pessimists" will argue that such an insular system will likely become another weapon in the intramural struggle for Putin's good graces.