Kremlin Adopts Incentive Pay Plan; Raises to Come as ‘Redundant’ Jobs End
A new wage system to give factory workers greater incentives to produce more goods has been adopted and will take effect Jan. 1, a Soviet official has announced.
If it works as outlined in the government newspaper Izvestia, there will be no ceiling on the pay of industrial workers who turn in the best performances on the job. Under the plan, if a worker produces twice as much, he would receive double his usual salary.
There is an important condition, however. All the funds for pay raises must come from savings achieved when “redundant” or “unjustified” jobs are eliminated as part of Soviet leader Mikhail S. Gorbachev’s economic acceleration program.
In addition, a leading Soviet economist has suggested that higher wages may be accompanied in the future by increased prices for food and other living costs that are now subsidized by the government.
Removal of Pay Limits
The new wage system, announced by B. N. Gabrilov, deputy chairman of the State Committee of Labor, in an Izvestia interview, provides for removal of restrictions that have limited most factory workers’ pay to a maximum of 300 rubles ($450) a month.
Instead of providing the same pay for the same job classification, the article said, pay in the future would be linked directly to production.
The workers who lose their jobs under the new plan, Gabrilov explained, would undergo retraining to prepare them for a new job. During this time--expected to last for several weeks at least--the worker would receive the same amount of pay.
Under existing conditions, many industrial workers have no incentive to produce more than their factory-set quota. If they do, management can increase their quotas and they receive no additional pay for their increased output.
In addition, fellow workers whose work standards also would be raised would tend to disapprove of those who forced them to work harder for the same pay.
Restrict Quota Changes
The new plan would allow work quotas, or “norms,” to be changed only twice during each five-year plan. This would allow a worker who gets higher pay for harder work to cash in on his extra effort, Soviet sources said.
Similar pay incentives would be established for factory managers, foremen and engineers. On the down side, traditional bonuses for managers--especially those not linked to greater efficiency--would be slashed.
Meantime, sociologist Tatyana S. Zaslavskaya wrote in the current edition of Kommunist, an ideological journal, in favor of a major change in wage-price policy.
The article took on added weight since she is a close associate of Abel Aganbegyan, an economic adviser to Gorbachev and a leading advocate of changes in the existing system.
Zaslavskaya proposed a sharp increase in wages along with an increase in prices and charging fees for many public services that are now free or very inexpensive.
Products Sold Below Cost
She mentioned bread, milk and meat as examples of products, now furnished below the cost of production, that would have higher price tags under her plan.
By channeling the state payments for subsidies to individual workers, she argued, workers would have enough money to make their own choices.
As an example, she said that if Soviet shoes were not in demand because of their low quality, the workers in shoe plants would suffer the consequences in the form of lower pay.