TYPES OF CONSTRUCTION WORK AND THEIR SHARE IN THE TOTAL VALUE OF STATE CONSTRUCTION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00246A007500020002-5
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 22
• Document Creation Date: December 22, 2016
• Document Release Date: July 20, 2009
• Sequence Number: 2
• Publication Date: August 31, 1959
• Content Type: REPORT

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.Subject: Types of Construction Work and Their Share in the Total Value of
State Construction.
Section I: Housing, General, Urban Repairs,:.and-Rural Construction.
Introduction.
The preceding parts described the principles of allocation of individual
construction works and projects among the ministries responsible for individual
types and branches of the construction industry. The present part will contain
a quantative analysis of the contracting system.of the state construction enter-
prises in order to define the share of various types of work in the total produc-
tion of the state enterprises.
About 30% of construction-assembly work is implemented outside the state
contracting system of which:
about 10% by the private sector
6% by the cooperative sector
and l1.% by the state self management economic system
This 30% implemented outside the real state construction i dustry includes
the following types of work:
a/ The private sector implements mainly rural construction in villages
for private farmers (peasants), by building houses, stables, barns which is called,
in general, homestead construction (budownictwo zagrodowe). This constitutes about
60% of the work of the private sector. It also builds new apartment houses and
makes repairs to housing in small towns. This accounts for the remaining 40% of
its work.
b/ The cooperative sector builds housing in towns by tenants
cooperatives.
c/ The state self management economic system repairs factories, does
small investment construction of roads, railroads, and also small investment
projects on state agricultural farms.
In the following pages the state contracting system.will be mainly described
since it represents the construction industry in Poland.
As stated before the contracting system embraces only 70% of the total
national construction assembly production, and all further analysis in this part
will refer only to this 70% because they represent the construction industry proper
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According to the classification presented in the preceding.part, the entire
construction industry was divided in 27 items in eight groups. The present
analysis will keep this division into eight groups but some of the most important
of them will be described in more detail, so the number of groups will rise
to 12. It should be added here that the official Polish statistics prepared by
the Main Statistical Administration (GUS) list only the following six groups:
1. General construction work (Roboty ogolno-budowlane)
2. Of which Housing construction and (Roboty mieszkaniowe)
Special construction work (Roboty specjalne-budowlane)
Of which:
3. a) Industrial construction (Budownictwo przemyslowe)
If. b) Engineering constructions (Roboty inzynieryjne)
5. c) Agricultural and forestry work (Roboty rolne i lesne)
6. Assembly work (Roboty montazowe)
This division by GUS is in conformity with the initial concepts which were rejected
in planning practice as unsuitable. E.g., assembly work is mainly just industrial,
yet the GUS statistics omit such important types as mining construction,. long
.distance transmission net construction,? even capital repairs.
The present analysis describes 12 groups which are so.arranged that it is
possible to compare them with the six groups of GUS, and also contain all 27 items
of the classification. Some groups embrace several items of the classification.
These 12 groups are as follows:
1. Housing, construction
2. Social-cultural, shops, warehouses, and office constructions
3. Capital repairs of housing.in towns and settlements
4+. Rural homestead construction
The above four groups exhaust the entire General construction as it
is listed by the integrated GUS statistics in its groups 1 and 2 (see p-
5. Industrial factory construction
6. Industrial-mining.and industrial-transmission net construction
7. Industrial capital repairs
The above three groups exhaust the entire industrial construction
industry and refer to group 3.and 6 of the integrated GUS statistics. (see _g-'""t
8. Transportation and communication engineering constructions
Communal engineering construction
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10. Mining,and transmission net engineering constructions
The above three groups exhaust the entire engineering construction
and refer to group 4 of the integrated GUS statistics (see p.,2)
11. Land improvement works, which refers to group 5 of the GUS
statistics.
12. Various works and projects.
This last group, which embraces only 2% of production, is needed for
including a small number of works which are difficult to assign precisely, among
them geological drillings which are included perhaps, without reason in the
Construction-Plan.
For each more important type of the. construction industry two comprehensive
diagrams are included in this part such as:
Diagram for: General construction
Industrial construction
Engineering construction
Total construction - assembly production in 1957
Total construction - assembly production.in 1958-1960
It should be added that this part covers not only the past and current
situation but contains an analysis of the individual types of construction work of
the Polish state construction industry planned for the near future, and trends.
This quantitative analysis is based on the communique of the Polish Main Statistical
Administration (GUS) for 1958, on the economic directives for 1959-1965 published
during the III Congress of the Polish United Workers Party in 1959 and articles
published in the Polish daily Trybuna?Ludu, Zycie Warszawy and weekly Fundamenty,
Investycje i Budownictwo, and Gospodarka Komunalna, during the period including
May 1959.
1. The share of the housing construction in the production of the state
construction-assembly enterprises.
The Housing construction is one of the most important types in the
production-of the entire state construction. industry. Not all housing is
constructed by the state enterprises, some is built by private owners by them-
selves, some by the construction cooperatives, some by the self management economic
system, but mainly by the state enterprises in the contracting system. This study
considers only housing built on the contracting system by the state construction
industry.
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Of 368,000 rooms built in Poland in 1958 in urban and rural areas, about
131,200 rooms were built without the aid of state credits. In addition 38,700
rooms were built from the means of the population with the aid of state credits.
These two categories were built mainly by cooperatives, therefore the state
production embraced only 198,700 rooms i.e., 54% of the total number. A part of
these rooms, about 12%O,or about 24,000 rooms, were built by the self management
economic system, therefore only about 175,000 i.e., 48%.of the total rooms were
built by the state construction industry on the contract system. Therefore, it
can be stated that at present and during the period 1958-60, the state construction
enterprises in Poland are building less than 50%o.of the total rooms constructed.
During the preceding years, this relation was different. The state construction
enterprises built from 65-70%,of the total but the number of rooms was much lower
during the period 1956-57. Thus, now in absolute figures, the state construction
enterprises--e-et build a few more rooms than before. Since housing construction
outside the state enterprises increased greatly, the percentage share of the state
construction enterprises in housing construction-decreased during the last three
years from two thirds to one half of the total production.
According to the Small Statistical Yearbook 1958 page 65:?---
Rooms constructed and given for use:
1955
1956
1957
1958
a/ Total
252;100
263,500
346,200
368,600
b/
From above: by socialized
housing construction
178,900
159,600
203,300
198,700
c/
By individual private housing
construction
73,200
103,900
142,900
169,900
tith the hear future, including 1960, the annual number of.about 200,000
rooms to be built by socialized construction will increase slowly in the
following years. These built by the cooperatives, as well the individual private
housing construction without the aid of state credits especially in rural areas
will increase rapidly.
The government has the following tendency:
To reach in 1965 a yearly production of about 465,000-470,000 rooms* by increasing
the cooperative housing construction (mainly tenants, cooperatives) to about 110,000
rooms in urban areas, to increase individual housing construction mainly in rural
* The figure 465,000 was given in Polish daily Trybuna Ludu.on 15 Jan .1959.
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and partly in urban areas to a total of 190,000 rooms, and by maintaining the
current 1959 production of state construction enterprises or increasing it slightly
to about 179)000 0rrooms.
During5t ast four years there was a big increase in investment. outlays for
I
housing construction in comparison with the total national investment outlays.
According to the Small Statistical Yearbook 1958 page 61 the investment outlays
for housingamounted:
during the period 1950-1955 an average 11.2% ) of
in 1956 13.7% ) the total
in 1957 15.1% ) investment outlays.
As was already explained 0 a e B i1,p. , the official
statistics prepared by GUS belated give figures of the private housing
construction built without the aid of state credits. A study by the Housing
Construction Institute published in the Polish monthly Investycje i Budownictwo
No 8, 1958, which should be regarded as true, gives the following. average
percentage:
- 1956 17.6%
1957 20.6%
The GUS communique about the implementation of the yearly economic plan for 1958,
published in Trybuna Ludu on 10 Feb 1959, stated that the outlays for housing in
1958 amounted to 23.8%,of the total investment outlays in the country. No doubt
this is a big increase in the percentage share of the housing construction in the
national investment outlays from 17.6% in 1956 to 23.8%_J1 1958, and
T_ I
labout 25% in 1959; but this is still insufficient, as the
Western countries less ruined by the war use on average about 40% of their invest-
ment outlays for housing construction.
The table on p.t shows the figures for housing construction in comparison
with total investment outlays during the period 1950-65. These figures were
taken: - for 1950-57 from the Small Statistical Yearbook 1958 page 61;
- for 1958 from the GUS communique published in Trybuna Ludu on 10 Feb 195;
-`for the period 1956-60 and 1961-65 from Directives for economic deve-
lopment of the Polish Peoples Republic published in Trybuna Ludu
22 Mar 1959.
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The Percentage Share of the Housing Construction Outlays in the Investments of
the Entire National Economy.
Total Outlays for
Investments Housing Construction Percentage
Billion zlotys
In 1956 prices
Period 1950-55
Year 1956
Year 1957
In 1958 prices (approximate
coefficient for
conversion)
Year
1958
Period
1956-60
Period -.
1961-65
24+5.4+
27.5
11.2
51.7
7.1
13.7
54.1
8.2
15.1
1.17
1.8
47
16.1
23.8
3+5.0
73.8
22.0 s
514.4
123.7
24.0s e
The share of housing construction in the investment outlays of the entire
national economy is not equal to the percentage share of the entire housing.. construc-
tion in the construction-assembly production.of the state construction enterprises,
for the following reasons. First of all, more and more housing construction is
Al
implemented outside the state enterprises and as1result of their share in housing
construction tends to decrease. Secondly, housing is exclusively a building
investment (no-:=machines are purchased for an investment of this type) therefore it
influences the activity of the construction enterprises to a greater degree than
one would expect from its share in total investments.
The result of these opposing factors is that the share of housing
construction in the production of the state construction-enterprises stays more or
less on the same level of about 23-25%. According to the Small Statistical
Yearbook 1958 page 67, housing construction implemented by the state enterprises
amounted, in 1956 prices:
in 1956 to 7.016 billion zlotys, which is 23.7% of their total
production-----in 1957 to 7.786 billion zlotys, whir epresented 25% of their
total production. In 1957 in current prices, the share of housing construction in
construction-assembly production of the state enterprises amounted to 25.5%. The
total production-of the state enterprises amounted to 36.947 billion zlotys. (These
last figures for the year 1957 were taken from the Statistical Bulletin No 8, 1958).
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the construction-assembly production of the
state enterprises amounted in 1958 current prices to 40 billion zlotys, including
10 billions for housing construction. (No reliable statistical figures for the
year 1958 could be found.) This 25% will be kept for the next 2-3 years. The
state enterprises subordinated to the Ministry of Construction and Building
Materials Industry are the main producers. According to Trybuna Ludu of
8 Feb 1959, which published a report on the discussions at the Sejm on the 1959
budget, the Ministry of Construction has to give for use in 1959 1+0,000 rooms
i.e., 13,000 more than in 1958. In order to get from these figures on rooms to
total financial value the following calculations:
. As is shown above, the Ministry of Construction supplied 127,000
rooms in 1958, of this 30,000 rooms were started and finished in 1958 at a cost of
52,000 zloty in 1958 prices each, i.e., for 1.6 billion zlotys. In addition
97,000 rooms which were started in 1957 were finished at 30,000 zlotys each, i.e.,
2.9 billion zlotys. Finally, 1+0,000 rooms were started in rough stage at 22,000
zlotys.each, i.e., 3.1 billion zlotys. This gives a total for 1958 of 7.6 billion
zlotys.
housing construction plan for the year 1959 in 1958 prices at 8.6 billion zlotys,
which amounts to 39% of the sum allocated to this ministry for all construction
work and projects for the year 1959 as given by Trybuna Ludu published on 8 Feb 1959
in.a round figure of 22 billion zlotys.
Slimming up:
a/ During,1958 - 1960 housing construction.in Poland will use .an average of
25% of the total national investment outlays
Of this 25%
b/ about 48-50% of rooms are built by the state enterprises by the contracting
system, and this 50% amounts to about u of the construction-assembly production of
the state enterprises in Poland.
c/ The state enterprises subordinated to the Ministry of Construction built
about 65-75% of rooms mentioned in para b/. Housing construction amounts to about
39-40% of alliconstruction work and projects allocated to the Ministry of Construc-
tion and Building Materials Industry.
d/ The remaining 50-52% of rooms mentioned in para b/ are built by other
state enterprises, mainly by those which are subordinated to the Ministry of
Communal Economy,.by local enterprises subordinated to peoples councils, and by
industrial ministries, especially the Ministry of Mining and Electric Power by so
called "scattered enterprises."
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2. General construction (excluding housing and rural construction)
From the technical point of view, general construction includes housing
construction, rural so-called homestead construction without land improvement,
electrification of villages, social-cultural construction, commercial (shops) and
office building construction, and finally capital repairs of housing. However,
because housing, rural construction and capital repairs are described separately,
this section will deal only with commercial, also called turnover construction,
(budownictwo obrotu towarowego), social-cultural and office building. construction.
Sport buildings and facilities are also included although they belong.more to
engineering construction, but they represent such a small fraction that it is not
worth while to separate them.
The table on p./0 shows that the outlays for commercial construction tend
to decline. During the Six Year Plan 1950-56 they still amounted to 3.3% of the
total investments, but during the current Five Year Plan 1956-60 they only amount
to 2.8%, and during the next 1961-65 Plan it is expected they will drop to 2.3%.
This should be regarded as a big mistake in the 1961-65 Plan because the commercial
net is absolutely insufficient, modern shops are practically non-existent and this
decrease of investment outlays for shops will have a negative influence on the
standard of living of the population. This is even more important because the
expectations of the government that the net of private shops would increase did not
materialize. On the contrary, a number of private shops and restaurants did not
renew the necessary licenses for the year 1959.
The investment outlays for social-cultural constructions are increasing,
especially in connection with the construction of 1,000 schools. The outlays for
the construction of schools will amount during the seven year period 1958-65 to
about 16 billion zlotys, to which another billion zlotys should be added from social
collection under the motto "Millenium schools." These outlays represent about one
third of the total outlays for social-cultural establishments during these seven
years.
According to a statement of the secretary of the Polish United Workers
Party (PZPR), Zenon Kliszko, published in Trybuna Ludu on 3 June 1959, the state in-
tends to build about 30,000 classrooms during this period. This is a large number
because in the preceding 15 years, 1944-59, only 25,000 classrooms were built.
However, 30,000 classrooms are not sufficient for the existing needs. During the
years 1959-65 the number of children in.schools will increase by about 2 million to
a total of more than 8 million. In connection with this increase, about 45,000
classrooms for elementary schools and about 12,000 classrooms for vocational and
y I ~...., ..J lI LJ
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secondary schools are needed according to the estimates of the Construction
Committee of the Sejm published in Trybuna Ludu on 5 June 1959. This committee
requests the organization in next,,years of about 250 local state construction
enterprises in connection with a big school building program which will amount
during the 1959-65 period, including;"1,000 Schools Social Fund", to about 17
billion zlotys.
This social fund is made from voluntary collections of all employed who
in general agree to pay one percent of salaries and wages. The peasants will pay
two percent of their homesteads income. The government announced one billion
zlotys as a goal for this collection, of which rural areas will have to pay 350
million zlotys.
During the first.half area of 1959 already about 400 million zlotys were
collected, of which 350 million were in cash and 45 million in materials declared
by the workers councils in industrial establishments.
One classroom costs about 535,000 zlotys on average in 1959 prices, of
which 85% goes for construction and about 15% for furniture and equipment. In this
way the construction of schools is taking first place within the social-cultural
construction. The construction of hospitals will also increase. Investment outlays
for hospitals, which amounted during the period 1955-57 to 18%.of the social-
cultural outlays, will increase to 21-22% according to the 1961-65 Plan.
About 85% of outlays for commercial construction and for soci7-cultural
buildings are used for construction-assembly work. The remainder is used for pur-
chase of hospital and theater apparatus and equipment, and for furniture and
equipment of schools, recreation houses, movies etc. Thus the expenses for the
construction-assembly production of this social-cultural and commercial investment
amountSto:
a/ 3.4 billion zlotys in 1956 prices in 1956
b/ 3.5
c/ 5.0
d/ 5
in 1957
in 1958 prices in 1958
it in 1959 25X1
The state construction enterprises implement about 70%,of social-cultural and
commercial construction assembly work by the contracting system and the self
management economic system.- The se system alone implemented
in 1956.about 2.1I billion zlotys
in 1957 about 2.45 billion zlotys in 1956 prices, which amounted
to about 7.7% of the total production of the state construction enterprisesin 1957.
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THE.SHARE OF INVESTMENT OUTLAYS FOR SOCIAL-CULTURAL CONSTRUCTION, AND
FOR COMMERCIAL-CONSTRUCTIONS IN THE TOTAL INVESTMENTS FROM 1950-65
Total Co
Investments Constr
mmercial
uction Outlays
Social-Cultural
Construction Outlays
Percentage Total
(billion zl.) (bi
llion zl.)
(billion zl.)
2:1 3:1 4-5
1
2
3
5
In 1956 prices
a.
Period 1950-1955
245.3
8.1
12.2
3.3 4.
9 8.2
b.
Year 1956
51.7
1.3
2.6
2.6 5.
1 7.7
c.
Year 1957
54.7
1.3
2.9
2.4 5.
4 7.8
approximate coeffi-
cients for conversion 1.17
1.55
1.30
In 1958 prices
25X1
25X1
d.
Year 1958
67.5
2.0
3.9
3.0 5.
8 8.8
e.
Year 1959
75.0
4.7
2.9s 6.
20 9.f
25X1
f.
Period 1956-1960
3+5.3
9.4
21:.5
2.8 6.
4 9.2
g.
Period 1961-1965
514.4
11.4
38.0
2.3 .7.
4 9.7
Sources: a, b, c, Small Statistical Yearbook 1958, p. 61
d, GUS Communique on implementation of the 1958 Plan
f:, g, Directives for the economic development of Polish Peoples Republic
Trybuna Ludu 22 March 1959.
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To this social-cultural and commercial construction should be added
administrative office building construction, buildings for party, labor unions,
etc. which amounts yearly to about one billion zlotys of the investment outlays
at present, and to about 850 million.zlotys in construction production. All this
is implemented by the state construction enterprises by the contracting system.
Therefore general construction of the state enterprises amounted, in 1957, to 3.3
billion zlotys i.e., 11%.of the total production of these enterprises. This
proportion will increase in the next years to 13%.
Summing up it can be stated that the general construction embracing
social-cultural establishments, commercial, office and social-party buildingsand
facilities (excluding housing and rural construction) from 11% to 13% on/ average
12%, of the production of the state enterprises by the contracting system.
3. Capital repairs of housing in towns and settlements.
Capital repairs of housing are done in Poland:
a/ By private people who carry on the repairs of their own houses
using private craftsmen. These are mostly small current repairs and maintenance
jobs the share of which is small, and for that reason they will not be described in
this paragraph.
b/ Capital repairs implemented by the state by the contracting
system including private buildings. The owners pay contributions to the Housing
Economy Fund (FGM) and the state carries out these capital repairs using funds from
FGM and contributing the necessary additional sums.
During the period 1952-58, the state spent for capital repairs of
private houses 3.145 billion zlotys when the payments from FGM amounted only to
745 million zlotys. Thus the state added 2.400 billion zlotys for the repairs of
private houses (Figures from Trybuna Ludu on 27 Feb 1959). The government is forced
to such a course because it keeps the rents so low that an owner of a house is not
able to pay the costs of repairs. On the other hand, if the state would not repair
these private houses the people would be imperilled and the state would have to
provide new and safe houses for them. Of course these 3.145 billions during the
seven year period 1952-58 -- the equivalent of 10,000 rooms -- is like a drop in
the ocean and the process of deterioration of private houses continues. A new law
is in preparation at present (but not passed yet by Sejm) which will establish
that all these expenditures provided by the state for the repair of private houses
will be put as a mortgage on the repaired house. The owner will not be entitled to
collect proper rent but must repair the house, it is true not from his own pocket,
but he will be indebted to the state for the repairs. This will lead to a kind of
ationalization of private housing.
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c/ Capital repairs of buildings owned by the state and administered by
The following amounts were spent for capital repairs of state owned
and private houses repaired by the state during the years 1950-59:
Outlays for capital repairs
of housing in towns and Billion zlotys Billion zlotys
settlements*
in 1956 prices in 1958 prices
a/ year 1955 1.50
b/ year 1956 1.64
c/ year 1957 1.96
d/ year 1958 ( 1.99
e/ year 1959 planned ( 1.83
f/ period 1950-55 5.22
g/ period 1956-60 ( 7.60
Source: Years1955-57 Small Statistical Yearbook 1958 p. 62
SS'
Period 1950--. and 1956-60 Trybuna Ludu on.10 Feb 1959 and 27 Feb 1959.
The table *n % shows that the yearly outlays for capital repairs
amounted during the period 1950-55 to about 870 million zlotys, an equivalent of
about 20,000 rooms in comparison with the total number of existing rooms in towns
and settlements of more than 6.5 million. According to technical norms, about
1.6% of the total value of existing rooms, or in this case the. equivalent of about
100,000 rooms, should be spent annually for capital repairs.
During,the period 1950-55, the outlays for capital repairs of housing
amounted only to 20% of real needs. Former minister of communal economy,
St. Baranowski, admitted, according to Trybuna Ludu.of 27 Feb 1959, that the outlays
for capital repairs covered hardly 33% of needs, and even this figure is too
optimistic. He considers that the planned 10.1 billion zlotys for the period 1956-
&0
-5e--- about 2 billion zlotys yearly covers 78% of existing needs for capital
repairs. this figure is exaggerated because including the
increase of prices, and the increase of total housing to 7 million rooms, it will
cover hardly 4+0% of existing needs.
* About 1/3 of these were to private housing,after 1954.
~??'Jt~d x"'f
coefficient .of 2.6
conversion is 1.31
from '58 to '56 2.4
prices for repair work)
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The responsible contractor for capital repairs of housing is the Ministry
of Communal Economy, through the subordinate Central Administration of Municipal
Repair Construction Enterprises which controls about 70 enterprises located in
all voivodship and some county towns. Capital repairs are carried out by the
contracting system uneconomically and with an enormous bureaucracy because repair
construction work is not suitable for the implementation by the state industry.
The production of the.ab.ove-mentioned 70 municipal repair and construction
enterprises (Miejskie Przedsiebiorstwo Remontowo Budowlane-MPRB) amounted to 6.3%
of the total value of the entire construction-assembly production in Poland in
1957. It was a very very low percentage, one of the lowest in the world. The
percentage share of the housing repairs in the production of the construction
industry should be between a to 1/3, or the equivalent of 100,000 rooms compared to
the planned annual construction of around 400,000 rooms.
It.. Rural (homestead) construction.
Rural construction belongs to a type of general construction, and is
carried out mainly privately for individual farmers. Construction for the state
agricultural farms (Panstwowe Gospodarstwo Rolne-PGR) is done by the self-manage-
ment economic system of the PGR construction teams (Zespoly Budowlane PGR).. On
some state agricultural farms the so-called model agricultural farms like Machnow,
Goldap, Olsztyn Orneta and a further five to seven very large state agricultural
farms, all construction was and is to be carried out by the state enterprises
controlled by the Ministry of Construction during the period 1955-63 for a cost
of about 200 million zlotys yearly. The County Construction Enterprises (powiatowe
Przedsiebiorstwo Budowlane) subordinated to the peoples councils and to the ad-
ministrations of the Ministry of Construction and Building Materials Industry
(double subordination) build projects of a total annual value of around 300
million for the production cooperatives (collective farms). These county con-
struction enterprises build also rural schools, maternity and medical stations,
and recreation houses in villages. The total production of rural construction
by the state enterprises amounts to only 3% of the production of state construc-
tion enterprises, and about 6% of the production of the Ministry of Construction.
The above-mentioned county construction enterprises have a larger program
.and also take up construction work in small towns, a type of work which does not
belong to rural construction. They tend to undertake the construction for villages
unwillingly, although they were created for that purpose.
13
~6N~~ err' ~~v
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n~w~
Capital repairs of homestead building are carried out privately by
peasants. The state enterprises do not do capital repairs in villages. The
state only allocates some building materials through Peasants Mutual Aid, but in
insufficient quantities. Since 1957, however, there has been some improvement
in this field.
The condition of buildings in villages is bad. During a scientific
conference about the effectiveness of investments in agriculture, which took place
in 1959, the following data was presented concerning housing buildings in villages,
according to Trybuna Ludu of 4 Feb 1959:
Buildings in good condition
Buildings requiring medium repairs
Buildings requiring capital repairs
Buildings completely unusable
37.2%
21.3%
22.6%
18.9% i.e., about 106 million
square meters of living
Areas is completely destroyed
One can see from the above that the share of the rural homestead
construction in the production of state construction enterprises is very small. This
is a paradoxical situation if we consider that the investment outlays for agricul-
ture amount to.a high percent of the total national investments, as is shown in the
table below.
Percent of the rural construction
to the national investment outlays
Total .q
of which
zlotys investments private investment
a/ period 1950-55 in 1956 prices 32.4 13.2% 4.4%
b/ year 1956 9.6 18.6 6.6%
c/ year 1957 10.1 18.7 9.0%
approximate coefficient for
conversion
d/ year 1957 1958
e/ year 1958
f/ period 1956-60
g/ period 1961-65 plan "
1.22
12.x+ 19.6
9.0 13.3
x+6.3 13.1
70.8 13.8
Sources: a/b/c Small Statistical Yearbook 1958 p. 61
d/. Article by Stanislaw Okolo-Kulak under the title "Planning of
Agricultural Investments" published in Polish monthly Investment
and Construction (Inwestycje i Budowni'ctwo) No 5, 1959, P. 16.
e/ GUS Communique on implementation of the 1958 plan.
f/g/ Directives for economic. development of the Polish Peoples Republic
approved by the III Congress, of PZPR published in Trybuna Ludu,
22 March 1959.
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At present, investments in agriculture amount to about 13% of the total national
investment outlays in Poland. It is characteristic that in 1957 they amounted
to as much as 19.8%, however, their share in 1958 dropped as did the absolute
value from about 12.4 to 9.0 billion zlotys in comparable 1958 prices. This drop
was caused by the discontinuance by the state of.large investments for production
cooperatives and agricultural state farms, and by stopping the construction. of
large state agricultural machine stations, called POM. Because the construction
for state agricultural farms and for agricultural machine stations was done by the
state construction industry, the contracts of the state construction enterprises
were most affected. For this reason, the state construction.enterprises were no
more interested in. agricultural investments, and the rural homestead construction
only amounts at present to about 3%:of the production of state enterprises by the
contracting system.
But this neglect of rural investments is a mistake made by the state
construction industry because the private rural construction does not decrease but
increases very, much. Thus the villages take away the available labor force,
especially bricklayers; causing great difficulties and shortages of labor for the
construction industry especially in.sunnter and fall. The construction industry must
take this more and more into consideration. and not ignore it. Even the Minister
of Agriculture requested the construction industry to train more bricklayers and
carpenters in addition to the present quota for rural areas, but the state
construction enterprises do not do it, and the situation is still unresolved.
Of course not all agricultural investments embrace construction work.
According to the article written by Okolo-Kulak.in Investment and Construction, No 5,
1959 under the title "The planning,of agricultural investments" the capital assets
in agriculture are divided as follows:
Buildings and construction projects
75%
Machinery and installations
10%
Basic livestock
15%
Seventy-five percent of investments in agriculture are connected with buildings and
other construction work which include melioration of land.
According to the Statistical Yearbook 1957 p. 157, the homestead and
housing construction (called also building construction 'Budownictwo Budynkowe')
amounted in 1956, in 1956 prices, to the following percent of the total national
investments in agriculture:
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a/ individual farms
b/ production cooperatives
c/ state agricultural farms
d/ state machine stations
e/ land melioration
f/ electrification of villages
g/ veterinary service
h/ agricultural schools
i/ various
Investments in of which for
Individual Sections the Homestead and Percent
of Agriculture Housing Construction 2 of 1
Billion zlotys
3.418
2.2+8
66%
0.638
0.236
39%
2.556
0.696
25%
1.112
0.227
20%
0.826
neg.
0.367
neg.
0.87
neg.
0.101
neg.
0.385s
neg.
Total 9.590 3.377
35%
The above table shows that, in 1956, only 35% of the total investments in
agriculture was used for homestead and housing. construction in villages and the
rest was swallowed by state machine stations, state agricultural farms, production
cooperatives, electrification, etc. for other than building purposes. This was
changed since 1956, and most important for the construction industry is the fact
that the relative share of such investors as state agricultural farms, state machine
stations and production cooperatives is decreasing and the share of individual
private farms is increasing. This trend means the investments are becoming more
construction-labor consuming, and that the share of building construction is
increasing. This is clearly visible in the table where the investments for buildings
in 1956 consumed about 66%o,of total investment outlays for agriculture, and state
machine stations only 20%. It is a fact that the number of new homestead and
housing buildings constructed in villages has greatly increased since 1956. The
official statistics are not precise in this zN&p but Trybuna Ludu published on
8 Feb 1959 a statement made by a deputy to the Sejm, Feliks Baranowski, according
to which the following number of homestead and housing buildings were built in
villages:
1956
55,200
1957
unknown
1958
95,000
1959
120,000 (estimated)
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However the county architects who know these problems from practical
experience stated during their convention (meeting of the Committee for Urbanization
and Architecture on 2 June 1959) according to Trybuna Ludu.of 4 June 1959 that
170,000 buildings will be built in villages in 1959.
At any rate, according to 1961-65.Plan, an annual average of 200,000
houses will be built in villages which is almost four times more than in 1956. The
rural construction will no doubt have a big influence on the labor situation in the
state construction industry because the homestead construction in Poland will be
the largest among 'eastern blocs countries, probably relatively larger than in the
USSR. This is a consequence of the development of the individual private peasants'
economy in Poland.
The planning of rural individual construction is much more difficult than
for the state construction industry, and it is also difficult to forecast with
certainty how much the individual peasants will invest in homestead buildings
and housing from their income and savings. Inspite of that, it is possible to plan
with some accuracy for the following, reasons. The peasants are willing to invest,
especially because their homesteads were neglected during the period 1945-57 in
connection with the state agricultural policy of collective farms. In.addition,
the peasants have at present.a much higher income, and the size of investments is
limited only by the shortage of building materials. For this reason the villages
will invest to the extent that they obtain building. materials. Because the
allocation of these building, materials is decided by the State Economic Planning
Commission, the state is easily able to-define and plan the volume of private
construction in rural areas by rationing of the allocation of materials.
A mixed Sejm-governmental committee was created . in. 1959 to decide the
allocation of building materials for rural areas for individual peasants for
the period 1960-65. This is a problem of national and political importance becase
it is a matter of proportional division of production of building materials between'
socialized construction in towns and private peasant construction.
Although the plan for rural construction was not finally fixed, the
,/
following data were published in the Polish monthly Gospodarka Planowa No 5,, 1959,
page 61 and 62, in.an article written by an employeeof the construction department
of the PKPG, Miron Pomianowski, under the title "The problem of supply of building
materials for the rural market:"
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COEFFICIENT OF INCREASE,OF RURAL HOMESTEAD CONSTRUCTION DURING THE.PERIOD 1958-65
taking the construction-assembly production in rural areas in 1957 for 100
a/ Value of the construction -assembly production of
rural construction in 1957 in 1958 prices
(altogether, with and without aid of state credits)
b/ Cubature -total
of which:
(1) housing.construction
(2) livestock construction
(3) other homestead construction
c/ Total to be built in rural areas during the Five
Year Plan 1961-65
1960
1965
132
265
136
286
121
243
150
337
145
304
- housing 1.0 to 1.2 million rooms or 90 to 108 mill. cu. meters
- livestock and other homestead buildings 160,000,000 cubic meters
d/ Allocation plan of building materials for rural areas,
taking the allocation,of materials supplied for rural
areas in 1957'as 100, for private and cooperative needs,
but not for the state enterprise S.
Cement
143
302
Bricks
173
497
Prefabricated elements
161
376
Lime
121
206
Lumber
113
177
Tarpaper
94
111
Roofing. ceramic tile
155
386
Eternit tile
213
669
The reality of the total rural construction plan therefore depends mainly
on the supply of materials. The plan listed on p./f g'is doubtful, especially
in paragraphs of bricks and roofing tiles (ceramic). In 1957, 562 million units
of wall materials were supplied, i.e., bricks and prefabricated elements together,
of which 377 million were bricks and 185 million prefabricated ceramic units. This
means that rural areas should receive in 1965 4.97x377 i.e., 1.870 billion bricks.
calculated, in.a similar way, the absolute value of the 25X1
A6
prefabricated elements planned for the year 1965 3:67-x 185 i.e., 0.700 billion
ceramic units. Therefore a total of 2.570 billion units of wall materials should be
allocated for rural areas in 1965, which represents about 27.5% of the total
production of wall materials in Poland in 1965.
' 1 ..FL.11'L`? ut
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/ O
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6 JAL
It does not seem probable that such an amount of wall materials could
be allocated for rural areas; therefore the reality of the rural construction
plan is in.danger. It is probable that a maximum of 80%.of the plan will be
implemented. As far as roofing tiles are concerned, 23 million were supplied for
rural areas in.1957. The planned 3.86 times increase means that 89 million roofing
tiles should be allocated, or 34% of the total planned national production in 1965.
It is doubted that 34% of roofing tiles could be allocated for rural areas because
this would undermine the urban construction plan. The above analysis shows that
the rural construction plan is large compared with previous years, but the 230,000
buildings planned as a yearly average during the period 1959-65 is difficult to
achieve because of the shortage of mate?ial. Therefore probably about 20% of this
plan will.hot,be implemented.
New agricultural policy.
.The meeting.of the II Plenum of the Central Committee.of PZPR which took
place in Warsaw, 22-24 June 1959, was devoted to agriculture. According to
Trybuna Ludu 24.June 1959, P. 5, it was decided to increase the government's help
to.agriculture in rural construction, homestead construction .and land melioration:
...."According to available provisional data, more than 37,000 houses and about
54,000 various homestead buildings were constructed in 1958, which represents a
tripling of housing construction, and more than ,a seven fold increase In homestead
construction compared with 1954"..... This figure of 91,000 buildingsgiven by
Gomulka is not final because the so called "wild" (illegal) construction figures
will not be available for official statistics for some time.
In general, the
achievements of rural construction are estimated) Ito be higher
16
as given on page 199e of 95,000 buildings. 25X1
The great increase of homestead buildings since 1954 is of interest. Until
1954 the peasants invested very little in homestead buildings such as stables,
barns, and so on, because they mistrusted the government. as it was the period of
enforced collectivization, and besides no building materials were allocated for
villages. After 1956 the peasants started to build more homestead buildings but
still not enough in relation to the existing needs and negligence of the preceding
years. Gomulka stated further: "1,200,000 rooms will be built in rural areas
during.the period 1961-65, and new homestead buildings of a value of .40 billion
zlotys will be constructed. Two and a half times more cement, more than 2 times
more lime, and almost 4 times more wall materials will be allocated for the rural
construction in 1965 than in .1958".....
..,,r,;,rr,
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J ~!'J U if Ali
These figures are more or less in conformity with those given on p. /F-
9-comparing the allocation of building materials 25X1
for rural areas in 1965 in relation to 1957
.Cement
Prefabricated elements
Bricks
Lime 2
Gomulka stated in addition:
...."The total sum of investment credits allocated for rural construction increased
from 0.7 billion in 1954 to 2.1 billion zlotys in 1958 (in 1958 prices). During
the seven year period 1959-65, credits allocated for this purpose will amount to
23.4 billion zlotys. This means a yearly average of about 3.34 billion zlotys
for rural construction investments (excluding land melioration).
The new agricultural policy initiated by Gomulka during the II Plenum
of the C.C. PZPR in June 1959 represents a very important economic and political 25X1
move. it,is a step backwards. In 1957 Gomulka announced that
the obligatory deliveries would be abolished by 1959/1960. Indeed they were cut
from year to year, and in.1959 they 'amounted to about half of the former burden
which the peasants were charged in 1954. However Gomulka stated in June 1959
that the obligatory deliveries will remain in force at least-for the next seven
years..
By doing this Gomulka is withdrawing from his promises. Although the new
program foresees that what the peasants will lose by obligatory deliveries will
be returned to them in the form of credits and government/ aid, these credits will
be given to agricultural circles and not to individual peasant-farmers.
Because it is not possible to.organize the collective farms (konozes) in
Poland without destroying, agricultural production, Gomulka initiated a compromise
policy of semi-kolhozes i.e., agricultural circles (Kolka rolnicze). The new policy
is not a wise one, and its implementation and effect are doubtful, but it will have
an influence on the construction industry.
Above all it will mean an increase of investments during the period
1961-65 by 24 billion zlotys. The original investment plan amounting to 18.7% of
nat,Ionah!_income, arshare.:triticized by the Polish economists because it has too
much influence on the standard of living of the population, was increaseLstill more
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by this allocation of 24+ billion zlotys. Thus it is planned that about 20% of
the national income will be allocated for investments! The accumulation i.e.,
investments plus reserves, will increase from 23.8% foreseen for the year 1965 in
the directives of the II Congress of PZPR to 25%! The demand for building materials
is increased, endangering the already strained construction plan. In connection
with this situation it will be necessary to reduce the export of metallurgical
products, which may make the balance of trade difficult. Gomulka stated that during
1961-65 period, exports will be reduced for this reason, and about 500 million
zlotys in hard foreign currency (zloty dewizowy, $ 1 = 4 zlotys) will be lost. The
entire new agricultural program seems to be risky and little success can be
expected. It is a result of the party policy; Gomulka does not want to encourage
the individual private peasants farms, he is looking.for compromise solutions in
order to bring the agricultural economy closer to a socialized economy, to some
substitute for kolhozes. He can't speak openly about kofhozes because a direct
announcement would violently worsen the agricultural production.
The situation in agriculture is not good in 1959, because a process of
crumbling of individual farms has started, and the effect is already being felt
because small farms do not mechanize and their production is usually low. Only
medium and large farms are productive. Because the Party does not want to permit
the formation of large private farms while the peasants do not want to form kolhozes
(which are also large farms) the Party has invented something intermediate,
"agricultural circles" or an association of farmers which owns agricultural machinery
and equipment, but this idea will very probably not be successful.
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