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Russian minister Gref highlights poverty as major social woe

01.01.70

ST. PETERSBURG, June 14 (RIA Novosti) - Russia's economics minister spotlighted poverty Wednesday as a major problem facing Russian society, but dispelled fears that a wide gap between the rich and poor could trigger social discord.

Speaking at an international economic forum in St. Petersburg, German Gref said: "Without tackling this problem we can by no means talk seriously about a favorable social climate in the country."

Gref said incomes among the top 10% of earners were 15 times higher than those in the bottom 10% in 2005. Although this was a dramatic disparity, Gref said, he dismissed expert predictions of massive unrest in the future.

According to statistical data cited at the UN World Summit in September 2005, 18% of the Russian population, or about 30 million people, lives in poverty. In 2004, poverty levels varied from 8-9% to 70% in some areas.

Gref also called for radical welfare reform, slamming the Soviet-era welfare system inherited by modern Russia as ineffective.

"We need to drastically change the social aid system in the country, make it targeted and channel all resources on aid to the vulnerable layers of the population," he said, adding that ensuring access to decent education and medical aid is also crucial for curbing poverty.

"The inaccessibility of decent education is a factor that prolongs the existence of poverty," Gref said.

Promoting small business and keeping monopolies in check are extremely important, Gref said, since "every monopoly nurtures poverty in the country."

Russia, which currently holds the rotating presidency in the Group of Eight club of leading industrialized nations, has said it will highlight poverty on the G8 agenda this year, along with energy security, terrorism, and the fight against infectious diseases.

Russia is also party to a World Bank and IMF initiative to reduce the burden of Heavily Indebted Poor Countries (HIPC).

In a bid to curb poverty and improve living standards at home, the Russian government has launched multibillion-dollar national projects to target healthcare, affordable housing, education, and agriculture. But many say the projects have yet to produce tangible results.

Expert opinion

Halter Marek

02.12.06

Halter Marek
Le College de France
Olivier Giscard dEstaing

02.12.06

Olivier Giscard dEstaing
COPAM, France
Mika Ohbayashi

02.12.06

Mika Ohbayashi
Institute for Sustainable Energy Poliy
Bill Pace

02.12.06

Bill Pace
World Federalist Movement - Institute for Global Policy
Peter I. Hajnal

01.12.06

Peter I. Hajnal
Toronto University, G8 Research Group