2% of Ukrainians working in a ministry usually steal

Author : 112.UA 112.UA

Respondent : Andriy Pyvovarskyi

Source : 112 Ukraine

Ukraine's Minister of Infrastructure says he was the apologist, who began to talk about the changes in tariff system
09:58, 17 March 2016

Journalist Vlaschenko: Today our guest is Minister of Infrastructure Andriy Pyvovarskyi.

Hello, Mr. Pyvovarskyi. December 11, you resigned. But at first, the Parliament did not consider your resignation, and then you changed your mind, together with other members of the government, which is also had an intention to resign. Why have you changed your mind?

Pyvovarskyi: Aivaras has opened up new possibilities to speed up implementation of reforms in the country. His words were a bombshell. In this situation, a system began to stir, the system began to think that something is going wrong. The international community has very sharply reacted to the statement of Aivaras, and following steps of the international community might be quite negative for Ukraine. In this situation, there was a long discussion within the Cabinet, and within a smaller group of people. Aivaras was also in this group. We discussed this situation, and it was decided that all the same it is a unique opportunity. And the ministers, the so-called technocrats, made a statement: "We are ready to return if certain conditions are fulfilled". We clearly stated the terms: privatization, fair wages for civil servants, judicial reform, reform of the medicine. And not in a year, but now... Because there is no reason to wait - the law is designed, the Cabinet is ready for actions.

- Many experts are asking the question: what, in fact, prevented the Cabinet from fulfilling the reforms?

- A lot of people came to me during the last year. Many people named those who sent them. And always there was one answer: let the man who directed you to me call me. Almost never nobody has called, except the deputies. Deputies has called me frequently. Privatization cannot be conducted due to the fact that the deputies do not know the laws, which would derive from the list of certain strategic assets. In these terms, we just cannot start massive privatization.

- Very rarely, the ministers come to the Verkhovna Rada in order to convince of the need for urgent adoption of certain laws.

- We try to explain and to convince. But we are informally told that "the bees cannot fly against the honey". In 24 years some kind of elite has formed, who has never been in business, has never created jobs, never risked with his own capital, had no relations with banks. Why should you buy an asset if you can put your man out there and do anything to make decisions on manufacturing plants to saw on metal, without possibilities for a loan, modernization?

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- Who represents these quasi-elites?

- This list seems to be endless. If I voice their names, it might lead to the legal proceeding. And, due to the fact that we have the most "fair" trials in the world, I will have a big problem. But the privatization is possible if the so-called elites spend their own money (money back from offshore companies). These companies will make the decisions whether to destroy the enterprise or to restructure it. But someone is “milking” the company, and then at the expense of the money fights against the Cabinet and privatization, urging MPs not to vote for the legislation.

- Do not you think that it is necessary to reform not only the industry but also the ministry? What you need to do in order to have in your office worked very people who will work effectively?

- There are 262 people in my ministry. In reality, 250 of them work today, but after February 16, a lot of people have intentions to resign. I do not sign them now, because if I do sign, the ministry will simply stop its work. Significantly reducing the number is no longer possible. We need to work with quality. If you look at a similar ministry in Poland, they employ about 900 people. This does not mean that we have to engage 900 people - we need to work with the professional quality of the people, who are in the ministry. In order to improve the quality, we need to increase salaries. If we increase salaries, we will provide additional motivation for older people to work more qualitatively. Not all people who work in the ministry for 10-15 years, are corrupted. Many of them are high-quality civil servants, with a very great store of knowledge. They must be motivated. When we say about the corruption in the ministry - 2% of employees usually steal. Many people have no assess to the process, they just do the paper job. The increase in salaries will attract new people into the Ministry, mix old and new experts.

Related: Aivaras Abromavicius left abroad and avoids investigation, - MP

- You talked to about $ 1,000 salary. Do you think that they have enough of that amount in order to avoid temptation?

- The average salary of state official in Poland is 700-800 EUR. Minister or deputy minister might get even more. But there are also the social packages for the civil servants, and this is very important. When I said that it is necessary to increase social standards, I mean not only salary, but also a social package. In 24 years there was a very strong devaluation in the payment system. Many civil servants due to corruption received 5-10 thousand USD a month. In the market sector, these people were not even analysts.

- The media wrote that you have been prosecuted because of salaries in the envelopes.

- Last summer, when I have changed several executives of very large companies, I faced a massive PR attack. All the tools were used - as with any "paid services". There were articles about the salary in  envelopes, and on the basis of these articles, a respected deputy filed a request to the National association of banks (NAB). NAB was obliged to start the process. All of us, including the audit of the company, went for questioning by the NAB and gave readings there. This is normal, but when I asked, on the basis of which it was made, it appears, on the basis of a newspaper article. And this newspaper article is not supported by anything.

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- Saakashvili accused you of underestimating railway tariffs in favor of Akhmetov. Does this system give preferences to big businessmen?

- If you analyze my performances over the past 15 months, you can see that I was the apologist, who began to talk about the changes in tariff system. My ministry has prepared a bill that would set apart from the tariff of 'Ukrzaliznytsya". The Parliament needs to vote for the bill. Last year, we raised the rate to 30% this year - by 10%. You can see how much public attacks on me has been raised because of the tariffs. Indeed, if you analyze the rise of the tariffs during those 24 years, and compare them with higher prices for manufactured goods and inflation, of course - tariffs go behind. But the last 15 months, the ministry says about an independent body, which will form the tariffs, and it is necessary to bring tariffs to economically justified levels.

Related: Ukrainian Government allocated 6,5 billion hryvnas to fix roads

- The main charge is that you allegedly failed to carry out deoligarchization of the industry.

- In the past year, we have liberalized licensing, liberalization of issuing various permits, passed a number of functions to the field. Passenger traffic, and this is the administrative service, costs from 50 UAH to a few hundred UAH. We also give books that allow our transporters to travel to Europe for a year. This book is about 1,000 UAH.

- Experts say that some parts of "Ukrzaliznytsya" has been already given to the private sector and even foreign companies. Is it true?

- No, "Ukrzaliznytsya" cannot be privatized and will not be privatized. "Ukrzaliznytsya" has some non-core assets, such as some mini-hotels, and "Ukrzaliznytsia" may decide to sell it or no. There are assets such as stevedoring company, for example, that work in the ports of the port infrastructure. In the world these are private companies, and we have both private and public. Private traders much more effectively use the manpower, infrastructure, and pay more taxes. Stevedoring companies should be privatized, but not through the sale, but through concessions, as it is done all over the world. Danube shipping company should be privatized - it is not strategic for the state. And there are many more assets to sell in order to create competition. There is a company "Ukrinteravtoservis". It is in the list of strategic, but 99.9% of the population have not heard about it.

- You worked in DragonCapital. Media reported that a large number of experts from DragonCapital cooperate with today's Ministry of Infrastructure, and that all these experts took a lot of money.

- No, they did not. Moreover, Ministry did not employ DragonCapital. I had two people from DragonCapital who helped me.

- What is the overall amount that went to peer environment?

- Nothing. That legislation, which we have developed has been done with the help of EU money. Several major projects that we have used, began in the 13-14-year. During this time, it took about 1 million EUR, but the EU paid for it, and they chose the experts.

- You have liquidated the "Ukravtodor".

- No, it eliminated one of the units of "Ukravtodor." Last May, the government adopted the concept of reforming "Ukravtodor", which offered a decentralization of its functions. We have broken the monopoly of "Ukravtodor." In order to decentralize functions, it was necessary to conduct an inventory. March 15, inventory is completed, and then t the process to star.

- When will you build the roads in Ukraine?

- Speaking about Kyiv, it is mayor’s responsibility. As for the roads of national importance, they are constructed under the program that is currently running, in some 5-7 years it will give the results. But in order to repair the entire surface of the national road, you need about 30 billion UAH per year. In the past year, we have allocated 3.4 billion, this year –more than 6 billion UAH. We agreed with the World Bank about the big project at $ 580 million for several years, we are working with the European Bank, the European "Investment banks", but this is not enough.

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- Our roads are very expensive - the money are just buried in the roads.

- Those requirements, which we carried out last year were three times cheaper than before. Somewhere we gave 300 thousand USD for one kilometer, while few years ago it might cost million dollars.

- Would you like to return to the business?

- Absolutely.

- What is your question?

- What would you do in my place now?

- You have already taken this responsibility, please stop doubting and do everything as quickly as possible. Because, I believe that you know for sure what you are doing.

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