President Vladimir Putin on Wednesday proposed a referendum on a dramatic package of reforms to Russia's Constitution that would strengthen the role of Parliament.
The Russian government resigned their posts en masse after the sensational announcement.
The move is likely to fuel speculation about Putin's political future after more than 20 years in power, but the Russian leader gave no hints about his plans for when his fourth Kremlin term expires in 2024. It also comes ahead of parliamentary elections due in 2021, with the ruling United Russia party suffering from dismal approval ratings.
The former KGB director announced the proposed package of reforms in his annual address to lawmakers, saying the public's representatives needed to play a stronger role in governing.
Russia is again seeing falling birthrates as the generation becoming parents now were born in the 1990s, when the birthrate fell drastically due to economic uncertainties following the collapse of the Soviet Union.
Payouts for families
"Russia's fate and its historic prospects depend on how many of us there are," Putin said, announcing new cash payouts for births and the extension of child benefit plans.
The address – delivered in the Manezh exhibition hall next to the Kremlin – is one of three big annual Putin events, along with a marathon press conference and live phone-in where he takes questions from the Russian public.
It comes two decades after Putin first became president following Boris Yeltsin's shock resignation on New Year's Eve 1999.
Putin has since held a firm grip on the country, staying on as prime minister when his ally Dmitry Medvedev took the presidency in 2008 for four years.
Frustration boiled over last summer, with thousands taking to the streets of Moscow to protest the exclusion of opposition candidates from local elections, leading to wide-scale arrests and long jail terms for a number of demonstrators.
Next year's parliamentary vote will be seen as a key test of the system Putin has put in place, with a strong – critics say autocratic – leader supported by loyalist parliamentarians and security services targeting the opposition.