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Sweetening A Bitter Pill: Russia Offers Debt Breaks, Other Benefits To Entice Draftees

Russian recruits take a bus near a military recruitment center in Krasnodar on September 25.
Russian recruits take a bus near a military recruitment center in Krasnodar on September 25.

Mobilization has been a bitter pill for many Russians to swallow.

Russian men face being called up to serve in the biggest war in Europe since the end of World War II with little training or supplies against a more determined and better-equipped opponent.

Tens of thousands of their fellow citizens -- including many professional soldiers -- have already died or been injured on the battlefield since Russian President Vladimir Putin launched the invasion of Ukraine seven months ago.

And there is no sign that the heavy Russian casualties will slow down as Western nations supply Ukraine with high-precision artillery and rockets as well as intelligence.

Putin’s September 21 decision to mobilize at least 300,000 Russian men -- and possibly up to a million based on some media reports -- has sparked protests around the country and driven, by some accounts, hundreds of thousands of citizens to flee to neighboring countries to avoid the draft.

The sharp backlash is already forcing the Kremlin to sweeten financial incentives to stem the protests and draft dodging that threaten to undermine its invasion strategy in Ukraine.

Russian lawmakers scrambled this week to pass amendments widening benefits for those serving in Ukraine as well as their immediate family members, including debt repayment freezes and outright debt forgiveness.

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Russian military officials have already promised to pay draftees a monthly salary ranging from 135,000 to 200,000 rubles ($2,290 to $3,400) depending on their rank, an amount that istwo to three times the national average, according to the Moscow-based Alfa Bank.

"We need to adopt the law [on debt relief] faster so that people can calmly carry out their combat tasks," Anatoly Aksakov, the chairman of the lower house of parliament’s financial markets committee, told fellow lawmakers on September 27 as they worked on the legislation.

The debt relief bill, passed on September 28, freezes loan repayments, including mortgages and consumer loans, for draftees and all others serving in the war as well as their immediate family members. The repayment freeze is valid during the course of their service and ends 30 days after demobilization.

The bill also forgives the debt of soldiers killed or severely injured during the war as well as the obligations of their close family members.

During the September 27 debate on the amendments, some deputies called for writing off the debt of all combatants, a step that Deputy Finance Minister Aleksei Moiseyev said went too far.

He argued that there was no need to forgive the debt of those who return without injury since they are earning “rather high” salaries for serving and their financial situation “will not worsen, but improve.”

Earlier on September 27, the parliament passed several amendments to the Labor Code, including guaranteeing draftees the right to return to their job within three months of being discharged and protecting their spouses from early layoffs or overtime work without their consent.

The amendments also exempt mobilized men and their family members from penalties for late payment of monthly bills for communal services and apartment building maintenance. The Duma is considering going even further and canceling the maintenance payments.

A woman in Moscow walks past a recruitment poster for the Russian armed forces on September 26.
A woman in Moscow walks past a recruitment poster for the Russian armed forces on September 26.

Dara Massicot, a military analyst at the Washington-based think tank RAND Corp, said the financial incentives will “help the [mobilization] news go down better” for some people but is not a panacea.

“For others, more money will not alleviate the risks, or solve how poorly troops are being supplied,” she said.

Some Russian draftees are being handed old weapons or undersupplied with gear, including medical aids, according to videos circulating on social media. Others say they are receiving little training and instruction.

Some draftees may be skeptical too that they will actually see the type of pay and benefits they are being promised, Massicot said.

“If the government has money for cash incentives, why don’t they have money to properly supply their troops with medical kits,” she said.

From Yakutia To Daghestan

The Kremlin-controlled parliament’s decision to approve incentives for draftees comes on the heels of wide-spread demonstrations against mobilization.

Protests have broken out in more than 30 locations, from Yakutia in the Far North to Daghestan in the Caucasus as well as Moscow and St. Petersburg, resulting in the arrest of more than 2,400 people.

Citizens are also venting their anger by targeting draft offices. There have been at least 20 attempts of arson -- some successful -- since the launch of the mobilization, including in the regions of Mordovia, Volgograd, Kaliningrad, and Nizhny Novgorod.

Some forms of protest have turned violent. On September 25, a man in Ryazan in central Russia set himself on fire at the central bus station, shouting that he did not want to go to war in Ukraine, according to local media outlet

A day later, Ruslan Zinin, a 25-year-old from the Siberian region of Irkutsk, shot and seriously wounded a military commissar. Zinin’s mother said he was distraught after his best friend was drafted despite not being in the reserves.

Labor Market Impact

While the Duma bill only concerns individual loans, state banks have stepped up to help owners of small and medium-sized enterprises who are drafted, including offering to postpone business loan repayments.

But companies of all sizes say the loss of skilled employees to the draft -- or flight abroad -- will nonetheless undermine their business and they are seeking exemptions.

Russia is already facing a tight labor market with unemployment at post-Soviet lows. Skilled workers are in especially short supply, experts have said.

Companies seeking exemptions for employees say it could take months to years to retrain replacements.

Tatiana Orlova, an economist at the Oxford Economics advisory firm, said the construction and manufacturing sectors could be more vulnerable due to a high proportion of male workers.

The National Association of Manufacturers of Building Materials and the Construction Industry and the Association of Pipeline System Manufacturers have already written to the government requesting waivers, warning they could face project and production delays.

We have received reports that entire enterprise workshops for the production of pipeline systems are being mobilized," Vladislav Tkachenko, the head of the pipeline association, told reporters.

Recruitment officials are increasingly visiting job sites to hand out draft notices, Russian media reported.

That is prompting some Russian companies wary of losing male employees to recommend -- or not hinder -- remote work.

Ozon, sometimes called the Amazon of Russia, sent a note to its employees this week saying it has always been open to the idea of employees working remotely and that “there are no obstacles” to doing so, Forbes reported.

An employee at a top Russian bank told RFE/RL that management sent a note to male workers recommending they work remotely and to avoid residing at the home where they are registered with the government.

A Russian company in the gaming sector took a completely different step to protect its employees when it learned that designers and artists -- a large part of its staff -- don’t fall under the category of IT workers exempt from service.

It ordered a charter flight to evacuate 100 employees and their families from Russia.

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    RFE/RL's Russian Service

    RFE/RL's Russian Service is a multi-platform alternative to Russian state-controlled media, providing audiences in the Russian Federation with informed and accurate news, analysis, and opinion.

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    Todd Prince

    Todd Prince is a senior correspondent for RFE/RL based in Washington, D.C. He lived in Russia from 1999 to 2016, working as a reporter for Bloomberg News and an investment adviser for Merrill Lynch. He has traveled extensively around Russia, Ukraine, and Central Asia.

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