Publication: Monitor Volume: 4 Issue: 164

President Mintimer Shaimiev has announced that Tatarstan is suspending some of its payments to the federal budget. Tatarstan is one of only about twelve Russian regions that pay more to the center than they receive back in federal transfers. Shaimiev said Tatarstan has no intention of shirking its responsibilities, but that the republic is redirecting the funds at its disposal to bail out defense-industry enterprises on its territory still owed money by the federal government. (RTR, September 8)

Shaimiev was referring the assistance provided by his government to two major aircraft factories in his republic. Workers there have not been paid their wages because the federal defense ministry has not paid its debts to the factories. The Monitor’s correspondent in the Volga region reports that, over the weekend, the Tatarstani paid those aircraft factory workers their wage arrears in the form of foodstuffs. Workers received flour, meat and canned goods. Dairy products and bread will also be available at reduced prices. Workers’ housing and utility bills will also be paid by the republic authorities and docked from the workers’ eventual wages. Children of factory employees are getting free school meals.

Shaimiev said his government would continue to support the enterprises for “two to three months.” He did not say what would happen after that. Some regional leaders, however, are calling for ownership of defaulting enterprises to be transferred to the property of the regions on whose territory they are situated. This could mean a massive shift of ownership and a corresponding increase in the powers of the regions. Actions like those of the Tatarstani government provoke speculation that the present crisis will result in regional governments taking over responsibility not only for enterprises on their territory but also, perhaps, for military installations. The governor of neighboring Saratov Oblast, Dmitri Ayatskov, has predicted that Russia will, as a result, evolve from a federation (characterized by a single army and currency) into a confederation (typically characterized by a variety of armies and currencies).