Federal Agency of Rail Transport
Russian Ministry of Railways

The Federal Agency of rail transport is a federal executive authority exercising functions in providing public services, state property management, and enforcement functions in the area of rail transport. Federal Railways was formed in accordance with a decree of the President of the Russian Federation dated 09 March 2004, the Ministry of Railways of Russia was abolished by the Decree of the President of the Russian Federation No. 314 "On the System and Structure of Federal Executive Bodies." The functions of the abolished ministry, the federal executive body, were transferred to the Ministry of Transport of the Russian Federation, the Federal Transport Supervision Service and the Federal Agency for Railway Transport.

This year will go down in history railways Russia simply because railway and themselves, and customers of rail complex known and common abbreviations "MPS". Behind left an entire era, when the railway was called to as state within a state. Now the country needed "communication" not only in the title: the growing economy of Russia needed an integrated transport system that meets modern requirements, not aggravating the economy, convenient and accessible to the public, producers and consumers.

Public administration in the area of rail transport is a three-tier structure. The Ministry of Transport shapes public policy and is responsible for creating the regulatory framework in the area of rail transport in the whole transport sector. Federal Service for Control and Supervision of Transport has, consequently, oversight functions, especially in transport security. The main function of the Federal Agency of rail transport is to implement public policy in the field of railway transport.

Railway transport of Russia is a complex multi-branch system covering railway undertaking, R&D, designing and educational institutes, vocational schools and colleges, social welfare and medical establishments. Being Russia-s main transport conveyer, railways fully meet the country's and public demand for freight and passenger transportation. Management and control of railway transport activity was maintained by the Ministry of Railways of the Russian Federation.

The Ministry of Railways of the Russian Federation (MPS) is a federal body of executive power vested with the task of implementing the state policy on the railway transport and to regulate the economic activities of railroads, enterprises and other institutions of federal railway transport, including those coming under specific railway companies, in the organization of transportation process. Transportation by federal railway transport is centralized and is exclusively in the competence of the Russian Ministry of Railways.

The Russian railway network includes 17 regional railways with a total length of approximately 86,200 kilometers. It is operated as an integrated system under the Ministry of Railways (MPS), established by presidential decree in 1992 as the legal successor to the All Soviet Union Railways. MPS's responsibilities are limited to the ownership and operation of railways within the Russian Federation. It has its own budget and policies and is responsible for coordinating all railway operations, determining rail policy and the legal frame-work governing railway operations, and planning and allocating investments, including for construction of new railways.

As a coordinating agency, MPS defines technical standards, sets tariffs, collects and apportions revenues among the regional railways, sets train schedules (up to one year in advance), and, in general, serves as the interface between the central government and the railway sys-tem. MPS is also the single decision-maker and buyer of rolling stock, track machinery, and other equipment for the regional railways. It does this on a contractual basis, with the regional railways financing their own purchases. For all practical purposes, surface transport in Russia, excluding pipelines, is by rail and will remain so for the foreseeable future, despite an expected increase in road transport.

A government resolution adopted on July 18, 1996 sets forth the following principal tasks of the Russian Ministry of Railways:

• to create conditions of stable operation of the federal railway transport to ensure a timely and qualitative interaction with other types of transport with the aim of meeting public needs in transportation and services, to ensure effective operation of all branches of the Russian economy and national security;
• to organize safe movement and operation of railway transport and other technical means on federal railways;
• to develop the services and infrastructure, jointly with the railways, to make the federal railway transport more competitive in the transportation services markets;
• to standards and norms defining the rules of operation of the federal railway transport as well as economic and legal mechanisms of their implementation on railway transport.

In 2003 the Accounts Chamber issued a Report on the results of auditing the compliance with the submission made by the RF Chamber of Accounts by the results of auditing legitimacy and expediency of using federal budget funds for state management of off-budget funds and federal assets in the RF Ministry of Railways in 2000.

The audit showed that a number of submissions made by the RF Chamber of Accounts in the course of auditing the activities of the RF Railways Ministry in 2000 were not fulfilled. In 2001-2002 the RF Railways Ministry continued to disburse centralized funds of the industry for maintenance of the central administration. The submission of the RF Chamber of Accounts related to bringing the headcount of the Ministry's administration in line with the limits prescribed by the RF Government was carried out only in February, 2002 (in 2001 the number of staff members in the RF Ministry of Railways exceeded the upper limit by 261 persons). The RF Railways Ministry did not ensure compliance with the RF regulations in making operations with the Ministry's administrative buildings and uninhabited premises held in federal ownership, no measures were taken to remove the existing drawbacks and no documents were signed with the RF Ministry of State Property.

Without coordinating it with the RF Ministry of State Property the Railways Ministry continues to lease and rent, on a non-repayable basis, uninhabited premises held in federal ownership. There was a lack of control over repayment of debts; no inventory of assets and financial obligations has been taken in the Ministry since 1992.

Decree #314 of the President of the Russian Federation "On system and structure of the federal bodies of executive power" signed 09 March 2004 abolished the Ministry of Railways of the Russian Federation and the Federal Service of Military Railway Services of the Russian Federation and formed the Ministry of Transport and Communication of Russian Federation, with the Federal Agency for Rail Transportation, passing it law-enforcement duty, function of rendering of state service and property management in the field of railway transport abolished the Ministry of railways of the Russian Federation, and the Federal Supervision Service for Transport, passing to it control and supervision functions of the abolished Ministry of Railways of the Russian Federation and Ministry of Transport of the Russian Federation.