Improving Legislation on the Implementation of Concession Agreements in the Housing and Utilities Sector

For over 10 years now, Russia has been using concession agreements in the housing and utilities sector, which are one of the main ways to attract extra-budgetary funds to upgrade utilities infrastructure. The housing and utilities sector accounts for 85% of all concession agreements that are being implemented or have been completed. However, the proportion of housing and utilities facilities that have been conceded is low at only 12.4% of the total amount. Overall investments in 60.8% of the agreements do not exceed RUB 10 million. Concession agreements are not sufficiently efficient due to a number of systemic problems and limiting factors, including: imperfections in concession legislation, a lack of reliable information about the implementation of concession agreements, the insufficient and non-systemic nature of support measures for concession projects, as well as a short-term and opaque tariff policy in the housing and utilities sector. The Russian government has set the goal of implementing a utilities infrastructure modernization programme and improving the quality of utilities for 20 million people by 2030. What should be the share of extra-budgetary sources in the implementation of this programme? What changes are needed in the regulatory framework to achieve this goal? What institutions need to be created or improved to protect the rights of parties to concession agreements?