Russia has an unacceptably large difference in the residents’ level of income, and 13% or 18 million people still live below the poverty line, President Vladimir Putin admitted during the State Duma meeting.

Putin noted that the number of people who live below the poverty line has been gradually decreasing. However, «the level of poverty is still too high».

The President proposed introducing a new salary increasing mechanism in the state sector to resolve this problem. He also talked about the introduction of the so called «effective contract», when a worker’s wage is directly dependent on his performance.

One more objective that was set by Putin – is the increase of work productivity in the country. «We are planning on increasing it 1.5 times at the expense of modernization of old and creating new high-tech production lines, as well as attracting long term investments in every subject of the Federation,»- claims the President.

Furthermore, according to Putin, Russia now has a «historic chance» to solve the housing problem, which persists for over a hundred years now and has «not been resolved since the tsarist times.» Putin believes that the country has all the technological and financial abilities to do it.

«Rosstat is calculating poverty levels, based on subsistence minimum, and is it very pitiful in our country: it is not just life that is poor, or rather beggarly, and one can only imagine what it means to live below this line,»- said the governor of the Expert fund of social research Pavel Kuduhin in an interview to BBC.

According to the expert, if poverty is calculated by other methods, the number of people living in poverty would turn out to be very high. At the same time, as Kuduhin notes, the total poverty level in Russia is declining on the background of the growth of real earnings.

Subsistence minimum in Russia has not been reviewed for a long time and it should be raised «two or three times,»- notes Ruslan Grinberg, Director General of the Institute of economy RAS.

«We have around 30 million people in the country that are in a state of desperation; often these people barely make it from one pay day to another. As it seems, around a half of the country’s population lives under quite unforgiving conditions,»- says the economist.

Subsistence minimum in Russia was 6 307 RUB in the first quarter of 2012.

Meanwhile, according to Rosstat, the highest level of poverty was registered in Russia in 1992 and was 33.5%. This index dropped under 20% only by 2004. During the economic crisis of 2008, poverty levels increased again, but it started decreasing again in 2009.

According to Rosstat’s assessment, the proportion of residents that live below the poverty line was 12.8% in 2011, which exceeds 2010 indexes by 0.2%.

Ref: 104.109.109.2843