Putin shocks Russia by picking obscure financial official as his PM

President Vladimir Putin accepted the resignation of his Prime Minister, Mikhail Fradkov, yesterday and nominated the even less well-known Viktor Zubkov to replace him, after several days of speculation among Russia's political players.

Mr Zubkov, 65, heads the federal financial monitoring service, which tackles tax evasion, money laundering and other financial crime. His surprise appointment was seen in Moscow as the opening move in a crucial election season, with parliamentary elections in December, and the presidential election next March.

Mr Zubkov's appointment has to be confirmed by a parliamentary vote, which is expected tomorrow, but is unlikely to be rejected. A wider cabinet reshuffle will inevitably follow. Yesterday's developments only added to the sense of uncertainty that pervades Moscow as the election season approaches. And Mr Putin's comments in accepting Mr Fradkov's resignation seemed to offer little reassurance.

"We all have to think together how to build a structure of power," he said, "so that it better corresponds to the pre-election period and prepares the country for the period after the presidential election in March."

Mr Fradkov, too, referred to "approaching significant political events" as his reason for leaving office.

The timing of Mr Fradkov's resignation, the relative obscurity of his successor and the fact that neither of the two presumed front-runners for the presidency was nominated all prompted speculation about the fate of the two favourites to succeed Mr Putin.

At a meeting with foreign academics and journalists, the first Deputy Prime Minister, Sergei Ivanov, sought to play down any suggestion he had been passed over, insisting that the change was all part of routine preparations for the parliamentary elections.

Coming hotfoot from the unscheduled cabinet meeting where he had learnt that he was from now on "acting" first Deputy Prime Minister, pending the reshuffle, he stressed the praise Mr Putin had lavished on Mr Fradkov, and the qualities that made Mr Zubkov ideal for the job: his low-key approach, his calmness and his qualifications.

In recent weeks, however, Mr Ivanov had seemed to gain ground on his presumed rival for the presidency, Dimitri Medvedev, taking a higher profile and speaking on issues far beyond his former defence and security brief. That neither Mr Ivanov nor Mr Medvedev was advanced yesterday led to suggestions that President Putin and his entourage were split on the succession.

Others, however, argued that it was in both men's interests not to be given the prime minister's post because of the risks that it might entail in the run-up to the presidential election. They also noted the parallels between Mr Zubkov's appointment and that of his predecessor, Mr Fradkov, whose nomination came as a surprise when it was announced a month before the last presidential election.

Mr Fradkov had also been chief of financial monitoring in the past, was older than most of the favoured candidates for the job and had pursued a similarly low-profile career. Mr Zubkov's additional qualification is that he worked with Mr Putin in St Petersburg in the early Nineties.

Another reason for the change suggested in Moscow was the criticism being addressed to the government by opposition parties. While Mr Putin's United Russia party is fully expected to keep its parliamentary majority, recent electoral reforms could make some of the contests close. Both the left, in the form of the Communist party, and the right, in the shape of Vladimir Zhirinovsky's Liberal Democrat party, are focusing their campaigns on the growing gap between rich and poor, and the Putin government's failure to deliver a higher standard of living, better housing, health care and education for the less well-off.

Both the change of prime minister and extensive statements and answers given by Mr Ivanov in his meeting with Western Russia-watchers yesterday, suggested the start of a concerted campaign by the Putin government to defend its record and promise visionary plans for the future.

Whether or not Mr Ivanov's political fortunes have changed, the time he devoted, his authoritative tone and the breadth of topics he covered left little doubt that any ambitions he might harbour to become head of state were still intact. Not being nominated prime minister in the dog days of Mr Putin's presidency may have been a blessing very lightly disguised.

Long association with the president

Viktor Zubkov, 65, is an economist and former tax official who has a long association with Vladimir Putin. He has headed the government department dedicated to fighting money laundering and financial crime for the past six years.

Mr Zubkov was born in Arbat, in the Urals, and worked as a factory fitter before qualifying as an economist specialising in agriculture. After his graduation, he ran state farms in the Leningrad region for 18 years. He worked with Mr Putin as an official of St Petersburg's foreign economic department in the 1990s after the collapse of the Soviet Union. In 1993, he became a senior official in the Federal Tax Service and Tax Ministry.

After his election as president, Mr Putin appointed him head of the Russian financial monitoring committee.

Mr Zubkov's son-in-law is the Defence Minister, Anatoly Serdyukov, a former head of the Tax Service International. Although not thought to have been a KGB officer, Mr Zubkov is considered one of the siloviki – politicians with links to the military and intelligence services – who hold influence in the Kremlin.