Russians largely against planned privatisations, poll finds

Russians largely against planned privatisations, poll finds
By bne IntelliNews April 27, 2016

A large majority of Russians do not expect a positive outcome to the government's planned privatisations of large state-controlled companies, a survey by the Moscow-based pollster VCIOM has found.

The poll, conducted on April 2-3 among 1,600 people across the country, found that while 60% knew of the government plans to some degree, only 20% approved of the idea when informed, and 68% opposed it.

Under growing fiscal pressure from low global oil prices and Western sanctions, the Russian government in late 2015 renewed privatisation plans that languished for the past five years. Companies in which state stakes are expected to be sold include Rosneft, Bashneft, Alrosa, Russian Railways, Aeroflot, Sovcomflot and VTB Bank.

The percentages in the new VCIOM poll contrast starkly with attitudes in 1991, when the first wave of post-Soviet privatisation was prepared. At the time, 32% of Russians were for privatisation and only 19% against, while the remainder could not decide.

Planned privatisations will lead to a further crisis in the economy, 48% of respondents now believe, while only 20% felt this way in 1991. While 51% of Russians thought then that privatisation will have a positive impact on the economy, that proportion now shrank to just 19%.

Only 15% of Russians believe that privatisation will lead to a fairer distribution of revenues among the population and 65% think that the effect will be the opposite. As many as 60% of the respondents expect price hikes following privatisation, while only 13% believed that prices could go down.

Opinions were almost equally split about whether privatised companies will be more efficient, with 36% sharing the idea and 35% opposing it.

According to the pollster, the scepticism of respondents stems directly to negative experiences of the privatisations in the 1990s, when a small clique of connected businessmen swept up many of the country's choice assets.

"Reasons for this kind of people's attitudes [about privatisation] are obvious," said VCIOM's Oleg Chernozub. "Public consciousness is projecting the previous privatisation wave's negative experience on the new one."

"If the government doesn't want to incur political risks linked to public opinion's rejection of privatisation, it should probably do it in several stages," he went on to say, adding that "possible success of the first stage could generate support for subsequent stages".