Translated material
Communal lobbying
Viktor Vekselberg asked the president for state support for his business in the housing and communal services sector
The private company “Russian Utility Systems”, from whose capital RAO “UES of Russia” (owns 25% of shares) is going to exit, it turns out, cannot live without “state support” for its activities. This was stated yesterday at a meeting with Vladimir Putin by entrepreneur Viktor Vekselberg, whose structures own 75% of the shares of RKS. The oligarch believes that his utility business is a social project: “I think that at the stage of formation, taking into account the fact that this sector still remains so socially sensitive and quite regulated, the participation of the state for a certain period would be advisable,” said the entrepreneur. -- And I would ask you to consider the possibility of either maintaining the position of RAO UES for a certain period, making an appropriate decision, or deciding so that the state would still reasonably accompany this project so that the numerous issues that arise would be agreed upon with both business and and with the interests of the state." “Now the Prime Minister is meeting with the Chairman of the Board of RAO UES, I will talk with him. I think this is advisable,” Vladimir Putin promised.Representatives of other utility companies call such requests “egregious.” In their opinion, if the state agrees to help only RKS, then this will only develop corruption. At the same time, they point out: the very fact that the president did not immediately reject the idea of state support for private businesses involved in housing and communal services indicates the need to begin real reform of this industry as soon as possible.
The RKS company was created in 2003 under the auspices of RAO RAO and several financial and industrial groups that intended to actively participate in reforming the electric power industry. Then Anatoly Chubais and Vladimir Putin agreed to consider the energy sector a business with a social and utility burden, as a result of which the reform of the industry was launched. However, the implementation of the reforms was delayed, and the utility project required considerable investment without a guarantee of return, as a result of which the oligarchs chose to leave the RKS. Their shares were bought by Mr. Vekselberg’s structures.
Meanwhile, the company's activities raised many questions. Subsidiary structures were organized in the regions, which worked as operators for the provision of public utilities, buying out the debts of municipalities to service providers (primarily to electric power companies). As a result, RAO found itself hostage to the situation: on the one hand, top management demanded that electric power enterprises reduce the level of accounts payable, i.e. ensure full payment for electricity and heat, and on the other hand, the same top management, which controls the work of RKS as a shareholder, gave instructions to provide a “green corridor” to this particular company. In the end, it turned out like the proverb about two birds with one stone: the energy sector was unable to receive money for the allocated resources, and the subsidiaries of RKS have not yet been able to ensure a return on the shareholders’ investments.
In particular, Mr. Vekselberg told Vladimir Putin yesterday that RKS carried out a bond placement for 1.5 billion rubles. It is officially reported that the company will spend these funds on new projects. However, market sources are confident that the money will actually be received by RAO RAO, which has until now financed the activities of RKS and has demanded a return on investment. And since the reform of the electric power industry has already dragged on for so long, utility agreements have become irrelevant for RAO, and it considered this business non-core and announced its intention to leave it. If the energy holding withdraws from the authorized capital of RKS, then obviously no one will politically protect the utility company from the need to pay off its debts. As the head of one of the regional energy companies says, it was for this reason that Mr. Vekselberg made a request to Vladimir Putin.
This initiative of the entrepreneur was appreciated by his colleagues in the utility business (and they can be counted on the fingers of one hand) with a fair amount of indignation. “The utility business is a business to be independent,” says one of them, who requested anonymity. - But he needs some “state support,” as Vekselberg put it, for example, the organization of the same public-private partnerships. But when only one company is supported, it raises questions, to say the least.”
And the president of the Eurasian Water Partnership, former head of the RKS Sergei Yashechkin believes that since Vladimir Putin promised to discuss the topic of private investment in housing and communal services with the prime minister, this is already good. “Government support for private companies is simply necessary; we need to help everyone in the regions hold competent competitions,” believes Mr. Yashechkin. - After all, local authorities do not know how to do this efficiently, and they are subject to various political trends. If they show her from above how to conduct this or that competition well, it will be just great. This is my appeal to Vladimir Putin.”