MOSCOW. July 28 (Interfax-AVN) - The all-Russian trade union of Navy servicemen and employees is calling for writing off the debts of the Defense Ministry's state-owned unitary enterprises and increasing the state defense order placed with them.
"Leaders of the Navy's trade union have called on the chairman of the State Duma defense committee to come up with legislation on writing off debts of the Defense Ministry's state- owned unitary enterprises to the budget and extra-budget funds," a competent source in the State Duma administration told Interfax- Military News Agency on Monday.
The trade union refers to both the debts that are not subject to restructuring and the debts whose restructuring is in progress at the moment, the source said. They amount to RUB787.43m (USD26,02m) and RUB548.26m (USD18.12m) respectively. "Extension of the installment pay-off period from six to ten years is among the ways of solving the problem," he said.
The letter sent to the Duma by the Navy trade union also asks for increasing the state defense order for the Navy's enterprises at least two times in 2004. "This will make it possible to ensure regular work of the enterprises for maintaining the Navy's combat readiness," the letter reads.
The call is made because the Russian government resolution on restructuring does not indicate the source of funding for debt repayment. The peculiarity of repaying debts of the past few years is that it can be done through adding something to current assets of the enterprises by the federal property owner, through borrowing, or through allocating a share of the enterprise's net profit.
The federal property owner does not plan to add anything to current assets of the enterprises in the near future. Loans have to be paid off and they do not cover the lack of current assets. The pricing policy of state customers is aimed at saving the state funds and does not make it possible to get enough net profit.
As a result, federal state-owned enterprises of the Russian Navy, especially those located in the Arctic region and in the Far East, have an acute shortage of current assets and have suffered enormous losses due to production facilities not working at the full operation rate and failure to cover production expenses.
In particular, the repair plant located in the Polyarny village owes over RUB84m (USD2.78m) to the budget and about RUB70m (USD2.31m) to extra-budget funds, the plant in Vladivostok owes about RUB30m (USD991,380) to the budget and nearly RUB32m (USD1.06m) to extra-budget funds, and the plant in Roslyakovo has a debt totaling nearly RUB200m (USD6.61m).