RUSSIAN PRESIDENT THREATENS CABINET RESHUFFLE.

Russian president Boris Yeltsin has told Prime Minister Viktor Chernomyrdin to draw up proposals for a cabinet reshuffle. "Maybe we need some changes, maybe we need some names, maybe we need some people to be changed in the government," he said. Yeltsin is clearly anxious to appease a population infuriated by the government’s continuing failure to pay wage and pension arrears, which is sparking a wave of strikes by teachers and miners. "Many people are fed up with the government, fed up with the prime minister and, consequently, fed up with the president. Such people are already a majority. This worries me," Yeltsin said. Chernomyrdin assured Yeltsin that all pension arrears will be paid by July. He said he already has ideas about fresh cabinet faces, but added that regional leaders often use money intended for pensions for other purposes. (Itar-Tass, February 24)

A likely victim in a cabinet reshuffle is Finance Minister Aleksandr Livshits, whose ministry’s failure to collect taxes is blamed for revenue shortfalls. Yeltsin recently gave Interior Minister Anatoly Kulikov increased powers to crack down on defaulters, but last week the IMF suspended payment of the February tranche of its $10 billion three-year loan to Russia, apparently unimpressed by the government’s efforts to date. Livshits yesterday blamed officially sanctioned tax breaks for much of the shortfall. He said tax exemptions cost the government $30 billion in lost revenues last year — three times more than the IMF loan. (Financial Times, February 25)

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