Dvorkovich Says Deficient Managers at State Firms Could Be Dismissed

ST. PETERSBURG — The government will dismiss senior managers in underperforming state-owned companies in a bid to improve performance, Deputy Prime Minister Arkady Dvorkovich said Friday.

He did not say how advanced the plans were, but named oil major Rosneft, gas producer Gazprom and Russian Railways among companies that need to cut costs.

Dvorkovich's remarks are likely to renew speculation about the future of Vladimir Yakunin, the head of Russian Railways and an ally of President Vladimir Putin, after a hoax e-mail this week announcing his dismissal.

"We will take the best companies on the market [as a benchmark] and push other companies so that they lower their costs to the same level," Dvorkovich told Rossia 24 television at a business forum in St. Petersburg.

"In many cases it will require management changes. We will be doing this. Inefficient ones will have to go."

Dvorkovich, a liberal economist who favors economic reforms, mentioned Russian Railways only in passing, praising recent cost cutting at the vast state company.

Speaking more generally, he said there was always "an optimal term" before a manager's efficiency begins to decline.

Rail chief Yakunin has faced public scrutiny over his business relationships and wealth, and industry insiders say rivals are trying to loosen his grip on the $46 billion that the state has earmarked for rail investment.

Some political analysts also interpret criticisms of Yakunin as a generational conflict between allies of Putin and backers of his younger prime minister, Dmitry Medvedev.

First Deputy Prime Minister Igor Shuvalov said the hoax e-mail announcing Yakunin's dismissal was a "provocation" targeting Yakunin personally, as well as the government.

"It does not have any negative consequences for Vladimir Ivanovich [Yakunin]," Interfax news agency quoted Shuvalov as saying.

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