Low-rise construction gets lobby boost

Low-rise and cottage construction gets boost from lobby agencies like the National Agency of Low-rise and Cottage Construction who help coordinate state and business interests.

RT Business spoke with Aleksandra Mochalova, editor-in-chief of the Low Rise and Cottage Construction magazine,  the official printing body of the National Agency of Low-Rise and Cottage Construction, about the efforts of the lobby.

RT: What’s the purpose of the National Agency of Low-Rise and Cottage Construction?

MA: “In fact, it’s a lobbyist group, a kind of platform which we use for the coordination of demands and interests of the state and various business organizations, such as developers, construction firms, banks, insurers, building materials producers, etc. The agency’s main task is to create favorable conditions for low-rise and cottage construction. It’s clear that this kind of construction makes no sense if territories under construction don’t have developed infrastructure, such as roads, schools and developing centers for children. So, apart from construction, the National Agency carries out integrated development of areas and their infrastructure."

RT: What do you think is the basis for effective cooperation between the state and business?

MA: “In fact, the efficiency of state-business partnership depends on how well the sides coordinate their actions. Business organizations should have clear understanding of the level of development of a territory under construction, while the state should guide the work of business structures and ensure transparent relationship. Otherwise, any ill-coordinated actions on the part of the state and business representatives may lead to considerable investment risks. Imagine a situation when the state decides to build a garbage processing plant in an area where apartment buildings are already being built. Our agency’s task is to prevent the emergence of such situations.”

RT: How does the agency coordinate partnership between the state and business structures?

МА: “Indeed, there are plenty of ways to do that. One is to fill in a list of needs which helps us to find the best way of matching the supply and demand of the state and business structures.”

RT: How do you assess prospects of further development of state-business partnership in the sphere of low-rise and cottage construction?

МА: “The state has already realized that partnership helps in solving a whole lot of problems in a more economical and environmentally friendly way. Today, the state-business partnership in low-rise and cottage construction is becoming particularly important because the state buys most of the housing available in the market. Previously, the Fund for utilities reform had the right to resettle certain social categories of people (young families, servicemen, veterans and migrants from Chernobyl) to apartment buildings. Today, the Fund has proposed submitting to the Russian State Duma a bill “On Financing the Construction of Low-Rise Housing from the Fund’s funds.”

RT: How do you assess the legislative basis for developing state-business partnership in your sphere of operation?

МА: “In fact, all the necessary legislative mechanisms have been formed. The state-business partnership in the construction of low-rise housing and cottages is regulated by special state institutions such as the Housing Construction Fund, the Agency for Housing Mortgage Loans and the ‘Rosoboronstroi’ construction company. It’s noteworthy that all the three are mature and well-established organizations which now operate harmoniously. The funds allocated by housing and utilities services prevented a radical fall in housing construction in 2009.”