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p Comrades, the third key question of the Party’s economic policy is improvement of the system of economic management. This is essentially a matter of how best to organise the activity of society in accelerating economic and social development, in ensuring the fullest use of the available possibilities, and in rallying even closer together hundreds of thousands of collectives, and tens of millions of working people round the main aims of the Party’s policy. Consequently, questions relating to management affect not only a 397 narrow circle of executives and specialists, but all Party, government and economic organisations and all collectives of working people. This means that improvement of management is an important component part of the Party’s entire activity in directing the economy. That was precisely the stand taken by the Central Committee at its December (1969) Plenary Meeting.

p Why is it that questions of management have now acquired especial urgency?

p It is above all because, as has been said, the growing scale of and the qualitative shifts in our economy now make new and higher demands on management, and do not allow us to be satisfied with the existing forms and methods, even where they have served us well in the past.

p Another thing to bear in mind is that the possibilities for improving management have been markedly extended in the recent period. This is due to the higher level of knowledge and professional training of our cadres, and of the broad masses of working people, and to the rapid development of the science of management and computer techniques.

p The political aspect of this question is also very important. The uninterrupted operation of the economic mechanism helps to create a good and businesslike atmosphere in the country, promotes labour enthusiasm among the broad masses, and leads to growth of initiative among the working people, because then the people see that their labour efforts produce the expected results, that they benefit the people and the whole of society. (Applause.) And, conversely, nothing so tends to cool people’s ardour as ill- considered decisions and bungling or bureaucratic practices on the part of individuals, which result in the wasteful use of labour, social resources and created values.

p In the period under review, much work has been done in the sphere of improving the economic mechanism. Following the re-establishment of the sectoral system of management the level of centralised direction of the national economy has been substantially raised. In accordance with the Party’s decisions, industry has been switched over to a new system of planning and provision of economic incentives, and this has made it possible to stem some undesirable tendencies in the economy of which there had been signs in earlier years. The line for the further development of 398 democratic principles has been expressed in the broader enlistment of the working people in the management of production, in the extension of the economic competence of the republics and regions, and also in greater operational independence for the enterprises.

p At the same time, life and practice—and they are the best teachers—show that we cannot rest content with what has been achieved. Improvement of the system of management is not an ad hoc measure but a dynamic process of solving problems brought up by life. We shall have to continue to focus our attention on these problems in the future.

p In this context it appears to be appropriate to deal briefly with some matters which, the Central Committee believes, are of great importance.

p On planning. Under socialism, planning is the central element, the core of national-economic guidance. Our country has major achievements in this sphere and justifiably takes pride in them. But we cannot afford to mark time, we must continue to work hard to improve both the theory and the practice of national-economic planning.

p The further raising of its scientific level becomes a task of primary importance. There is an urgent need to improve our planning methods. Planning must rest on a more precise study of social requirements, on scientific forecasts of our economic possibilities, on all-round analysis and evaluation of different variants of decisions, and of their immediate and long-term consequences. In order to fulfil this responsible and complex task there is need to broaden the horizons of economic planning.

p With ever greater frequency we are confronted with the fact that fulfilment of the most important economic and socio-political tasks requires a much longer term than five years. This raises the question of planning national-economic development over a long term, on the basis of forecasts of the country’s population growth, the requirements of the national economy, and scientific and technical progress. This approach, ensuring constant coordination of long-term plans with five-year and annual plans, can help in the more effective solution of the basic problems of our development.

p The comprehensive approach to planning and the adoption of major national-economic decisions acquire ever greater importance. The very nature of the tasks before us is such that their fulfilment, as a rule, calls for concerted 399 efforts by many branches and economic areas, and includes implementation of a whole system of diverse measures.

p Do we have any positive experience in this sphere? To be sure, we do. To take only the last few years there are the programme for boosting agriculture, the programme for developing the vast oil-bearing region in Western Siberia, the space exploration programme, and others. We are now faced with a formulation in greater depth of many other long-term programmes and their coordination with the overall plans for the country’s economic development.

p In planning work fuller account should be taken of local specifics. In our vast country, with its diverse conditions, this task is of primary importance. We must continue our work to improve the territorial location of production.

p Science has greatly enriched the theoretical arsenal of planning, by producing methods of economico-mathematical modelling, systems analysis, and so on. Wider use of these methods must be made, and sectoral automated management systems must be created more rapidly, considering that in the future we shall have to create a nationwide automated system for collecting and processing information. This makes it important not only to fabricate the necessary equipment but also to train considerable numbers of skilled personnel.

p Comrades, all the successes of our socialist economy are connected with economic planning. Future economic achievements will also largely depend on the quality of planning. That is why we must continue to concentrate our attention on its improvement. We must work consistently to enhance the responsibility of our cadres for the fulfilment of state plans and targets, and for strengthening planning discipline in every link of the national-economic mechanism.

p On improving the organisational structure of management. Life, the development of the productive forces, has also raised questions of improving the structure of economic management and specifying the functions of individual organs.

p What does this mean in concrete terms?

p It means above all the need to enhance the role and improve the work of the State Planning Committee and other all-Union state organs. To do this they should apparently be released from a considerable part of their routine business, to allow them to concentrate their attention on the 400 Emacs-File-stamp: "/home/ysverdlov/leninist.biz/en/1972/FLC499/20070308/499.tx" main problems of national-economic development. Another pressing question is to enhance the role and extend the independent initiative of ministries and departments, which also requires some specification of their functions.

p There is need for greater concentration of production. The experience we have accumulated shows that only large associations are equal to the task of concentrating sufficient numbers of qualified specialists, ensuring rapid technical progress, and making better and fuller use of all resources. The line of forming amalgamations and combines should be followed more boldly: in the long term, they must become the main units of social production operating on a profit-and-loss basis. In setting up such associations it is especially important that administrative boundaries and departmental subordination of enterprises should not be an obstacle to the introduction of more efficient forms of management. The process of concentration must also develop in agriculture.

p In improving the structure of management the Party believes it to be important consistently to practice the Leninist principle of individual responsibility for assignments. When a decision is taken it must be made perfectly clear who is responsible for it. Similarly, it must be made clear who is responsible when a decision that is mature for adoption is not adopted or is delayed. (Applause.) It is important to define at every level of management the volume and the balance of rights and responsibility. Great powers with little responsibility create possibilities for arbitrary administrative acts, subjectivism and ill-considered decisions. But great responsibility with small powers is not much better. In that position, even the most conscientious worker frequently finds himself powerless, and it is hard to make him fully responsible for the job assigned to him.

p In order to eliminate too many levels in management, we must seek to have decisions on most questions taken once and for all, instead of being passed on from one level to another. (Prolonged applause.) Every link in the management system must be engaged in its own work to prevent the higher levels from being cluttered up with a mass of minor matters which distract them from the major problems, and to allow the lower levels to deal efficiently with the matters falling within their competence. That seems to be right. (Applause.)

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p Improvement of the management structure requires a consistent struggle against any manifestations of the narrowly departmental and parochial approach.

p On increasing economic incentives. In its work to improve the guidance of the national economy, the Party has firmly followed the line of correctly combining directive assignments by central organs and the use of economic levers for exerting an influence on production. These levers —cost accounting, prices, profit, credit, forms of material incentives, and so on—are designed to create economic conditions promoting the successful activity of production collectives, millions of working people, and to ensure wellgrounded evaluations of the results of their work. The need lor precisely defining the measure of labour and the measure of consumption demands skilful use of all these levers, and improvement of commodity-money relations.

p The delegates to the Congress know that some measures have been taken along these lines in accordance with the decisions of the Central Committee’s Plenary Meeting in September 1965 "On Improving Industrial Management, Improving Planning and Increasing Economic Incentives in Industrial Production”. The experience of past years gives us grounds for saying that having begun the economic reform, the Party has correctly assessed the situation and steered a true course in improving the management of the national economy. However, far from all problems have been resolved.

p The experience that has been accumulated has made it more obvious where effort has to be concentrated. This is the creation of the economic conditions, which would, first, induce enterprises to undertake optimal commitments, i.e., adopt maximum plans and make more rational use of capital investments and labour resources, second, ensure the maximum acceleration of scientific and technical progress and the growth of labour productivity and, third, facilitate a consistent drive for higher quality in production.

p The consistent implementation of the principles of operation on a profit-and-loss basis remains an urgent task at industrial enterprises, at collective and state farms and at higher economic levels. The role of economic contracts and the responsibility for honouring them must be enhanced. Stable plan targets and economic norms calculated for a 402 number of years must be worked out for amalgamations and industrial enterprises.

p A major aspect of economic activity, on which the efficacy of production depends to a large extent, is the improvement of the system of payment for work. Conscientious, highly productive work must be encouraged and better remunerated. It would be expedient, as the experience of the Shchekino Chemical Works shows, to provide enterprises with broader possibilities for giving incentives to those workers and collectives of workers who make the largest contribution to the development of production, combine trades and adopt a master-like and thrifty attitude to social wealth. An increase of material incentives must go hand in hand with the promotion of moral incentives for work.

p In short, comrades, the Party organisations, our economic organs and the collectives of workers have to put in a lot of hard work to improve the economic methods of management.

p In this connection, a word must be said also about the responsibility that devolves on Soviet economic science. It has achieved certain successes in recent years. But the swift development of the national economy and the new tasks confronting it are bringing to the fore many intricate theoretical and practical problems that require unremitting attention from both economic bodies and scientists.

p On broader participation of the people in economic management. One of the Party’s central tasks is to draw the working masses into the management of production on an ever larger scale. What we must achieve is, as Lenin emphasised, that every working person, every politicallyconscious worker should feel "he is not only the master in his own factory but that he is also a representative of the country".  [402•1 

p We have immense possibilities for this. The people’s participation in economic management is not confined to resolving economic tasks in individual production collectives. A broader approach has to be adopted to this, in view of the role which our Party and the Soviet state play in economic management. Their policy, including their economic policy, is dictated by the basic interests of the working people. It is charted by representatives of the working 403 people in the elective organs, with the masses participating broadly in the discussion of major plans and decisions. The working people also actively take part in the control of the fulfilment of these decisions. The Party will continue to promote all these forms of socialist democracy.

p A big role is played in economic management by the primary Party organisations, which unite millions of workers, collective farmers and office employees. Utilising their right to control the economic activity of enterprises, they effectively influence matters concerning production. A big role is played by the trade unions in resolving economic problems, promoting socialist emulation and mass technical innovation and strengthening labour discipline.

p In the period under review there has been a marked upswing of activity by production conferences, workers’ meetings and general meetings of collective farmers. Concern must be shown to secure a further enhancement of their authority and bring the key questions of the life of the enterprises up for their discussion. It is necessary to encourage the practice of the heads of amalgamations and enterprises and also of top-level officials of ministries regularly accounting for their work directly to the workers.

p Alongside questions of production, questions of labour protection and the improvement of everyday conditions must, naturally, receive the closest attention of the collectives. The practice of drawing up plans for the social development of collectives deserves encouragement. The procedure of concluding and checking collective agreements should be improved.

It is our duty to translate Lenin’s behests still more fully into life and get all the workers, collective farmers and intellectuals to become conscious fighters for the implementation of the Party’s economic policy, to act like statesmen and fully display their abilities, initiative and economic acumen. (Applause.)

p Comrades, in the long run the success of the Party’s plans for economic development and raising the people’s standard of living depends on people. The guarantee of further achievements in communist construction lies in the conscious and persevering labour of workers, peasants and 404 intellectuals, of our Party, government, trade union and economic cadres.

p That is precisely why our economic programme must be reinforced by broad Party-organisational, political, ideological and educational work that can set in motion all the gigantic forces inherent in the socialist system and in the Soviet man, who combines the remarkable features of fighter, toiler and creator. (Stormy applause?)

Our purpose is to make the life of Soviet people even better, even more attractive, even happier. We are marching forward to many years of selfless and inspired labour, giving fully of our creative energy. For us this is the only way to welfare and happiness, to a radiant communist future. (Stormy, prolonged applause.)