Offshore accounts in Dubai and the abolition of bachelor’s degrees: how Valery Falkov manages billions from the Ministry of Education and Science

22:50, 02.07.2024

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Offshore accounts in Dubai and the abolition of bachelor’s degrees: how Valery Falkov manages billions from the Ministry of Education and Science

Valery Falkov, head of Russia’s Ministry of Science and Higher Education, presented a report to President Vladimir Putin on the federal project “Advanced Engineering Schools,” aimed at retraining experts for modern industrial and economic requirements.

The program has already received considerable budget support, though its effectiveness is being questioned by some analysts who point to mixed outcomes in related initiatives.

Falkov highlighted how the project is being executed and how specialists are being trained under its framework.

Retraining the undertrained

In 2022, the project led to the creation of 30 engineering schools in 15 regions; in 2023, the number of such institutions increased to 50. They now exist in all federal districts of the country. Partners in the initiative include 160 companies, which spent 19.5 billion rubles on it, while the state invested another 12 billion rubles.

However, according to the authors’ design, these programs are meant to adapt people who have already earned degrees to the digital economy. So does that mean Russian universities are not producing fully prepared specialists and have to finish the job? Looking at the list of participants, we see many institutes and universities. Are these organizations going to receive money for doing what they were supposed to do anyway?

Valery Falkov

Among the project’s partners are the largest state corporations — Rosatom, Roscosmos, Rostec, and others — but taking part is one thing, and actually hiring someone is another.

The idea of retraining personnel is not new: it existed in the Soviet Union, where major agencies and enterprises further trained graduates of institutes and technical colleges, because the “best education in the world” was too academic. Today the situation has become even worse — Russia is not a trendsetter in technological innovation, unless one counts the defense sector, and so the idea arose to compensate for the gap with the West.

Something other than a bachelor’s degree

Engineering schools are only one of Falkov’s proposals. In May this year, the minister promised that in Russia in 2025 the concept of a bachelor’s degree would disappear, replaced by higher and specialized higher education.

The reform is driven by the abandonment of the Bologna system, as well as the view that a bachelor’s degree is insufficient for mastering complex specialties. But the country lived under those rules for 20 years and changed its higher-education system for them.

It is unclear what will happen next with the huge number of bachelor’s and master’s degree holders, especially since the Ministry of Education and Science also wants to turn the master’s degree into a more advanced stage. In Russia, a candidate dissertation still exists there, and it is unclear what will happen to that. The authorities in Moscow do not intend to introduce a single PhD system in place of candidate and doctoral degrees, as in the West, so it is not clear what, how, and on whom Falkov’s new system will stand.

Training for drones

Another of Falkov’s initiatives is the creation of training programs for the use of drones in the civilian sphere, in which 70 universities are already involved.

Chinese Mavic drone

Before the “special military operation,” this issue was not given attention, but after the FPV drone, along with the Iskander missile, the Lancet strike drone, and guided aerial bombs, became one of the main weapons of the Russian Armed Forces, the country experienced a drone boom.

Falkov also supported the introduction of drone design and construction courses in schools, although most of them can be assembled from Chinese components. Perhaps it would be better to focus on producing the components instead?

The numbers are impressive, though: if the state participates, the drone segment of the Ministry of Education and Science project is supposed to reach 1 trillion rubles in turnover. One would hope this money would be spent in Russia, not on purchasing components from China through intermediaries.

Why such a drastic move?

Falkov’s initiatives raise serious questions. Why does the country need advanced engineering schools if the same functions are performed in hiring by the state corporations participating in the project? Why abolish the bachelor’s degree so abruptly if the country spent nearly 20 years painfully introducing this model? Would it not be better to allow universities to adapt their programs gradually to new realities? And as for drones, if the military aspect is set aside, then all their use should be tied to Russian production. Otherwise, the country will continue losing petrodollars on mass purchases of foreign components.

Sobyanin’s friend and Druzhinina’s friend

The criticisms of Falkov are not limited to his innovations; there are also concerns about his personnel policy, which has already led to a series of major scandals.

Before being appointed minister, Falkov was rector of Tyumen State University from 2013 to 2020. His rise is linked to Moscow Mayor Sergey Sobyanin, who is Falkov’s fellow townsman.

Moscow Mayor Sergey Sobyanin.

Scandalous but true: after moving to the ministerial post, Falkov brought Elena Druzhinina with him to Moscow and appointed her as his deputy.

In 2022, Druzhinina moved to the position of managing director for research and development at Rostec, headed by the Moscow mayor’s close associate Sergey Chemezov, and this reshuffling has a backstory.

Druzhinina did not get lost in the capital — the organization run by her sister, Irina Zhukova, the FGANU “Sociocenter,” has been notably active in public procurement. The structure conducts various research projects and serves as the operator of the “Priority-2030” program, created to increase universities’ contribution to national development goals. The project’s results are not very impressive, but its funding is substantial, and Falkov’s people are benefiting from it.

Elena Druzhinina.

FGANU “Sociocenter” is a supplier under five state contracts totaling 12.1 million rubles and a customer under 565 state contracts totaling 1.2 billion rubles; in practice, all of this is money from Falkov’s ministry.

It gets worse: among the five largest suppliers to Sociocenter was LLC Vektor, which had zero revenue in 2021. According to RIA Katyusha, money was thus siphoned off to offshore structures and through them to the UAE, where Falkov and Druzhinina allegedly have a two-level apartment worth $2 million with a crystal bathtub, in which one can presumably think beautifully about higher education in Russia.

Falkov and Druzhinina do not hide their personal relationship — the fact that they vacationed together at the Altay Village resort is no secret, although such corporate closeness is prohibited by bureaucratic rules.

Scandals involving his circle

In 2021, allegations were made against Deputy Minister of Education Marina Rakova for fraud involving state contracts worth 50 million rubles. Rakova, along with Druzhinina, is considered one of Falkov’s protégés.

Another case concerns Pavel Vaganov, director of the “Ural Academic” federal institution, who was implicated in buying an expensive car with budget money as well as in smuggling cash. This official was also brought to administrative responsibility 34 times by the Sverdlovsk regional office of the Federal Antimonopoly Service.

In each of these cases, the court imposed a fine, which was paid by the state. Despite this, Vaganov continues to hold his position because of his closeness to Falkov.

Falkov’s pro-Western people

The minister places his people everywhere, and not only through the crystal bathtub. Among his many protégés are Viktor Nedelsky, rector of Gorno-Altai State University, who was appointed despite extensive plagiarism in his dissertation, and Dmitry Livanov, rector of MIPT.

Nedelsky publicly refused to support the “special military operation” and later moved permanently to France, while Livanov, after February, invited Dmitry Muratov, editor-in-chief of Novaya Gazeta and recognized in Russia as a foreign agent, to MIPT. Muratov received the Nobel Peace Prize in 2021 and in 2022 used it to help Ukrainian refugees. The lecture was about generational conflict after the “special military operation.”

Falkov promotes his people everywhere to carry out his own policy inside the ministry, but somehow these people end up dealing with state contracts on one hand and outright Russophobia on the other.

Two faces toward the West

Falkov’s line toward the West is duplicitous. On the one hand, he is abolishing the bachelor’s degree, which emerged from the convergence of the Russian and Western education systems; on the other hand, the minister is encouraging the publication of scientific articles in English-language journals to raise the Hirsch citation index. This key indicator for Western science remains highly important in Russia as well.

The system of pay for Russian scientists is built around it: incentive bonuses are awarded only for articles and conference participation, with a Russian conference worth one point and an international one worth twenty.

Scientists close to Falkov, Iskander Taimanov and Andrey Mironov, after the start of the “special military operation,” participated in Western events where Russia was called an aggressor and a barbaric country because of the war. The Ministry of Education and Science turns a blind eye to all this, apparently seeing it as the development of Russian science in a difficult period.

And most importantly, the current system motivates young specialists to work with Western structures, make materials for them, and leave the country. Why are we creating engineering schools if we are ourselves motivating the best people to leave?

Falkov promotes mega-projects that require huge sums and, like Rosnano, do not guarantee results, while at the same time covering for people who work with the West and participate in anti-Russian events. On one side he is supposedly a patriot; on the other, in a sense, a “pro-Western mole.” And given the trail of scandals that has followed Falkov over the past two years, the pro-Western side of this two-faced Janus appears stronger