4.1 Entrepreneurship and Property
4.1.1 Conversion of the Social Infrastructure
Unresolved
Issues
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During the conversion of the social infrastructure,
a number
of problems arise, which can only be resolved by the local
authorities and various administrative levels: from the
Russian Federation Congress of People's Deputies to the
regional administrations.
As was noted earlier, the population's
low level of
expenditure on housing and public utilities was considered
to be a major achievement of Soviet power. Here one does
not
need to mention the quality of the housing. It was and is
far lower than apartment rents, which have not been revised
since the 1920s.
In addition, the Russian Federation's Constitution
stipulates that a Russian citizen's right to housing is
guaranteed by the "low housing and public utility charges".
We believe that we should do our best to
reject old
stereotypes as quickly as possible. To solve the problem,
people should be given the chance to freely choose where
to
live and which apartment to rent or buy, based only on their
own personal incomes. There is only one proviso: these
expenses should be taken into consideration in incomes,
including pensions.
On the other hand, the differentiation
in incomes will
continue increasing. A certain level of unemployment is
inevitable. In addition, there will always be large families
and solitary elderly people who need social protection.
These functions should be borne by the state via the
construction of low-cost municipal housing, and the
provision of various subsidies and privileges to low-income
individuals.
A number of existing legislative acts will
therefore have to
be reviewed. In particular, this involves laws on taxation,
housing, etc.
At present, legislation does not stipulate
any serious
economic sanctions for failure to pay apartment rent or
public utilities. A fine of 0.1% of the payments per day
overdue cannot be considered an incentive to pay for housing
on time. Lately, the number of individuals who have stopped
paying for both housing and public utilities has grown
considerably. Whereas in December 1991 in Nizhni Novgorod,
Arzamas, and other cities of the oblast, 4% defaulted on
payments, by August 1992 this figure had risen to 40%.
Such a sharp increase in the number of defaulters may be
attributed to a great degree to the cash crisis which has
arisen. Naturally enough in such a situation, people are
forced first and foremost to spend their money on food,
and
only then on anything else.
The situation is complicated by the fact
that, during the
conversion of the social infrastructure, public services
will be extremely dependent on the population. Whereas the
vast majority of resources used to maintain the housing
stock are remitted, via non-cash transfers, from the
profits of the enterprises, which list the housing stock
on
their balance sheets, in future the well-being
of the
services will be completely dependent on the residents'
solvency.
In this case, the public utility organisations
will be more
interested in receiving these funds on time. At the same
time,, however, penalties for overdue housing payments
should be increased. This is all the more justified, as
individuals will be receiving the requisite funds to pay
for
housing and public utilities.
One should have recourse to claims against
individual
property in the case of overdue housing rent and public
utility charges. The procedure for considering such affairs
in court should also be simplified as much as possible.
Moreover, one should substantially raise the fines for
overdue payment of housing rent and public utilities.
Significant amendments should be introduced to the
legislation regulating the minimum wage, and all related
systems. Otherwise, increases in the minimum wage by the
amount of compensation would lead to multiple rises, as
wages are "tied" to the minimum.
Approaches to the establishment of a consumer
basket, and
the determination of unemployment benefits, should be
reconsidered. When they are recalculated, one should bear
in
mind the full housing and public utility expenses.
At the same time, all the aforementioned disparities in
the
legislation do not prevent a conversion of the social
infrastructure on a regional level.
In this situation, one should exhance as
much as possible
the ability of the regions' administrators to take decisions
on these issues.
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