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p The socialist principle of distribution according to work will operate througlfout the period of communist construction. Payment according to work, states the Programme of the C.P.S.U., “will remain the principal source for satisfying the material and cultural needs of the working people”. From this it follows that the principal way to secure a high standard of living and economic equality is to increase individual payment according to the quantity and quality of work, reduce retail prices and abolish income taxes.

p Until 1955 the Soviet standard of living was raised chiefly by reducing retail prices, and there was only a slight increase in wages and salaries. This did not abolish economic inequality because the price reduction mostly 263 benefitted persons in the higher paid brackets who were enabled to satisfy more of their requirements than those in the lower paid brackets.

p In recent years the Communist Parly and the Soviet Government have taken steps to raise the pay of lower paid categories of workers and employees in order to shorten the gap between higher and lower wages and salaries. Some 4,000 million rubles were spent for this purpose in only the five-year period 1956-61. In 1964-65 wages and salaries were raised in public education, public health, trade and everyday services with the result that a pay increase was received by 20 million people. In 1965 alone cash incomes rose by more than 10 per cent.

p Along with increasing wages and salaries, the government abolished or reduced income taxes in the lower paid groups of working people. On a national scale this gave the people an annual addition of 760 million rubles to their pay. Higher labour productivity and lower production costs are making it possible to cut prices on consumer goods and thus boost the standard of living.

p Side by side with distribution according to work, more and more of the people’s requirements are being satisfied at the expense of the social consumption funds. These funds are set up to meet people’s requirements free of charge regardless of the quantity and quality of work. Distribution from these funds leads directly to communist distribution, to economic equality.

p The social funds, which are a new, socialist form of satisfying the people’s requirements, arc used to pay for the upkeep of kindergartens and nursery schools, boarding schools, and health and holiday homes, for education, for medical and cultural services, for pensions, scholarships, allowances and grants, for housing and communal services, and so forth. It is characteristic that these funds grow along with the growth of individual payments. The total sum paid out to the population from these funds has increased from 4.200 million rubles in 1940 to 41,500 million rubles in 1965. In other words, in 1965 the amount paid out was nearly 400 rubles per working person. The government allocates huge sums of money for the building, upkeep and repair of housing. Nearly half of the 264 population in the Soviet Union has been rehoused during the past ten years.

p The growth of the social funds tends to level out the incomes of the people and help to achieve economic equality because large families and lower paid workers receive considerably larger incomes from these funds than higher paid people.

p The satisfaction of requirements through social funds is in line with the collectivist nature of the Soviet system, makes it possible rationally to organise public education, the medical services, social insurance and other important social spheres, helps to free women from exhausting household chores, instils people with lofty morals, and gradually delivers people from anxiety linked up with personal ownership and attachment to items of prolonged use. Under communism it is hardly possible that anyone would think, for example, of having a country house (dacha) or car of his own, because facilities for rest in suburban areas and means of transport will be provided by society.

p The growth of social funds does not clash with the interests of the individual and does not reduce consumption. On the contrary, requirements are met more fully and, moreover, inasmuch as the concern for satisfying requirements is shifting more and more to the shoulders of society, people will get additional time for study, entertainment and rest.

p The decisions passed at the March and September 1965 plenary meetings of the C.C. C.P.S.U. and, in particular, by the 23rd Congress of the C.P.S.U. dealt at length with the ways and means of improving the socialist principle of distribution and raising real incomes. The Congress Directives on the 1966-70 Plan for Economic Development envisage an increase of approximately 30 per cent in real incomes in terms of per head of population. This will be achieved by raising the pay of industrial, office and other workers, increasing the incomes of the collective farmers in cash and in kind, reducing stale and co-operative retail prices as well as prices in the collective-farm markets and meeting more requirements at the expense of social funds. Under the 1966-70 plan the wages and salaries of industrial, office and other workers are to be raised by an average of not less than 20 per cent, while the increase of the 265 collective farmers’ incomes in cash and in kind from the socialised economy will average 35-40 per cent. This will narrow down the gap between the incomes of the collective farmers on the one hand and industrial, office and other workers on the other. In addition, cash allowances and grants paid out from social consumption funds will rise by at least 40 per cent.

A steady improvement of the socialist principle of distribution according to work combined with the continued growth of social funds and the gradual closing of the gap between the income levels of different categories of working people are thus the concrete way to recast the socialist into the communist principle of distribution, attain economic equality and thereby create identical economic conditions for the advancement of all citizens. The faster the productive forces and labour productivity grow the sooner will this equality be achieved.