Tuesday, 3 February 2009
Today the Government continued discussing the 2008 performance reports submitted by heads of ministries and government agencies.
Reports were presented by the ministers of nature protection, agriculture, public health care, education and science, sport and youth affairs, culture, employment and social affairs. They basically touched upon problems and shortfalls had in the year under review, considering that the extended accounts have already been presented the meeting participants and published on the websites of the ministries. The Prime Minister gave specific orders concerning the decision of the existing problems.
In connection with the report of the minister of nature protection, the Prime Minister noted that no serious problems were encountered as to the action plan and stressed the importance of those questions due to be addressed in 2009. “The ministry underwent serious organizational changes during last year. Quite naturally, it is necessary to specify the scope of actions with the ministry of energy and natural resources. It is the first feature of 2008. Secondly, we have already agreed upon the receipt of important technical assistance aimed at improving the legislative framework and, first of all, will focus on the effective use and management of natural resources. From this point of view our tax authorities will have some questions. In particular, if a structural division of the ministry carries out checks and surveys regarding the payment of environmental fees, it is necessary for you to provide such information to the authorities as well so as they can estimate correctly the level of taxes due from different operators. It is not a secret that here we have serious problems. Last year monitoring bodies also revealed that exploited are such mines which are not specified on the map that is we give licenses for one territory, while mines are operated in other areas. This prevents tax authorities from making accurate estimates of revenue,” the Prime Minister said and ordered to pay greater attention to this problem in 2009.
After the report of the Minister of Agriculture, the Prime Minister referred to three important questions. Firstly, it is the VAT law’s influence on agriculture. On this question, Tigran Sargsyan noted that, as matter of fact, the society is getting wrong signals that agricultural activity will be taxed as from 2009. “This is not the case. 80 percent of agricultural produce will not feel the influence of the law on VAT because the law affects only large businesses and it is necessary to provide a true description of the situation. That we could estimate precisely whether these are 10 or 20 percent, at the first stage it will be necessary for us to agree upon such criteria as will enable us to identify those operators subject to monitoring on the part of tax authorities. Because it is possible that they carry out monitoring of say several hundreds of farms, while the bulk of these several hundreds prove not eligible for VAT payment. We will have to agree upon such criteria as will be applied to tax-paying farms. He we will need your experts’ opinion for each farming sector,” the Prime Minister said.
In Tigran Sargsyan’s words, the second important question consists in that agriculture will be a priority branch of economy over the next few years as the global economic crisis creates exclusive opportunities for agriculture. In his opinion, there are spheres where we have sufficient potential and can launch production as a substitute for the imports which are extremely high. On the one hand, this will help create new jobs and on the other hand, it will bring about GDP growth, improved balance of payments and trading balance. The Prime Minister further emphasized that proceeding from this circumstance, the customs duties have already been reconsidered, having for object the assistance to those spheres where there is such potential. In this sense, he spoke about the necessity of making serious changes in the work of the Ministry of Agriculture. The Prime Minister also ordered to pay attention to the findings the RA Control Chamber and to take such measures as will rule out the recurrence of the recorded adverse phenomena in 2009. Tigran Sargsyan also called the attention of the Minister of Agriculture to the description of ministry functions, business processes, workplaces as in this case ministry-private sector cooperation will be more effective. “Those basic programs to be carried out with direct participation of the ministry assume cooperation between the State and the private sector. The State will create favorable conditions so as the private sector can carry out additional investments.
Processing industry today has far greater potential as evidenced by price fluctuations during summer and winter seasons. This indicates that Armenia has insufficient processing capacity,” the Prime Minister said. He said to be hopeful that he ministry will come up with new ideas concerning such processing enterprises as are in a position to function effectively in this sphere.
In connection with the report of the Minister of Health Care, Tigran Sargsyan pointed out the need for achieving progress under those 7 priority programs projected for the year 2009 and emphasized the necessity of attracting investment from the private sector.
Speaking about the important tasks set before the educational sector, the Prime Minister singled out the introduction of quality standards in higher educational institutions. This is crucial according to the heads of high schools. He emphasized that the State should provide for clarity in this field as otherwise healthy schools will be the ones to suffer. “These standards need taking root, and licenses will be called back from such institutions as fail to meet them. Here, I feel it very important that the council of rectors endorses this initiative,” the Prime Minister said. Concerning the problem of suspended students, Tigran Sargsyan said that the eligible high schools are prepared to host the best students from cancelled institutions. Underscoring that the State should be resolute in this matter, the Prime Minister expressed conviction that it will help reduce corruption in this field, boost student movement in the system of higher education.
Another important question is the discussion the National Competitiveness Council of the ways breakthrough programs should be implemented in this sphere. He noted that here too the ministry is expected to show due diligence giving effect to several breakthrough projects which will set an example to other educational institutions.
Following the report of the Minister of Employment and Social Affairs, the Prime Minister placed a special focus on the operations of the State Labor Inspectorate by noting that there are serious problems both in the sense of organization and personnel skills as evidenced by the reference note prepared on the part of the Prime Minister’s Control Service.
“Cooperation with tax authorities should be institutional. We must jointly prepare a document concerning the cooperation mechanisms, the frequency and the ways of exchanging information, conducting checks etc.” the Prime Minister stressed. He told the Public Revenue Committee to submit proposals on the ways of tackling these problems.
The Prime Minister instructed the Minister of Employment and Social Affairs to monitor in person the process of enhancing the State Labor Inspectorate’s performance in matters concerning the detection of unregistered workers. Tigran Sargsyan said he will take up the matter again in the second quarter of this year.
