SOVIET MILITARY-ECONOMIC PLANNING: THE ROLE OF THE STATE PLANNING COMMITTEE

• Document Type: CREST
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• Original Classification: T
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• Document Creation Date: December 22, 2016
• Document Release Date: September 2, 2010
• Sequence Number: 1
• Publication Date: June 1, 1982
• Content Type: REPORT

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Directorate of Top Secret
Intelligence
Soviet Military-Economic
Planning: The Role of the
State Planning Committee
Top Secret
SOV 82-10079JX
June 1982
Copy 307
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Intelligence
Soviet Military-Economic
Planning: The Role of the
State Planning Committee
Information available as of I May 1982
has been used in the preparation of this report.
SOYA, on
The author of this paper isl of the
Office of Soviet Analysis. It was coordinated with the
National Intelligence Council. Comments and
queries may be directed to the Chief, Effectiveness
Analysis Branch, Strategic Forces Division,
Top Secret
SOV 82-10079JX
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Soviet Military-Economic
Planning: The Role of the
State Planning Committee
The USSR State Planning Committee (Gosplan) has considerable influ-
ence over the content and implementation of Soviet military-economic
policy. Soviet leaders determine what overall priority military and civilian
claims will have in resource allocation. When making this determination,
they obtain Gosplan's assessment of the ability of the Soviet economy to
support military requests-documented by the General Staff in defense
plans. The leaders then rely on Gosplan to translate usually general policy
directives into specific production obligations for Soviet industry.
leaders accord to military efforts,
In competing for resources, the military benefits from several features of
Gosplan's organization and procedures. Gosplan's military-economic de-
partment, which oversees planning in the nine defense industrial ministries,
is staffed predominantly with military officers. Their effectiveness in 25X1
representing defense interests is enhanced by the high priority Soviet
Once the military claim on resources has been established,
the civil elements of Gosplan and the ministries can, in effect, propose only
Top Secret
SOV 82-10079JX
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Top Secret
minor revisions (disagreements on major issues can be appealed to the
national leadership). In contrast, the General Staff routinely reviews
civilian industrial plans and can propose modifications if it believes that
military peacetime or mobilization requirements may be jeopardized.F_
After the Supreme Soviet has given the force of law to these detailed plans,
Gosplan generally resists adjusting them. This encourages representatives
of the various interests to be bold when formulating their initial require-
ments. When a material shortage or other development during a plan
period requires some adjustment, Gosplan directs resources to the affected
parties in order of their priority, with the military at or near the top.
These advantages, however, do not mean that the military wins every
dispute over resources. Gosplan, which must implement all aspects of
Soviet economic policy, has been known to challenge the military when its
claims conflict with other leadership-sanctioned objectives. Thus, even
though defense interests can usually count on high-level support, the
military has good reason to maintain a cooperative relationship with
Gosplan.F__-]
If Soviet economic growth slows further in the 1980s, as we anticipate, the
military probably will come under increasing pressure from Soviet leaders
to justify its requirements. Indeed, to deal with growing economic difficul-
ties, Gosplan's authority in economic planning was recently strengthened,
and Gosplan is attempting to introduce advanced planning techniques to
better enable its central apparatus to compare alternative uses of resources.
We believe, nevertheless, that the military will maintain its commanding
position in the Soviet economy. We have no evidence of change in the
position and authority of Gosplan's military-economic department, and
people who can be expected to be favorable to the needs of the military
have been appointed to key positions in Gosplan.
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Contents
Gosplan's Role in Military-Economic Planning
Gosplan Structure
Military-Industrial Commission (VPK)
Military Preeminence in National Planning
Gosplan's Internal Operating Procedures
Central Planning
Negotiation of Differences
Preparing Plans
Adjusting Plans to Changing Conditions
Resolving Disputes
Appendix
The Economic Planning Process
Figures
')Fvi
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Top Secret
Soviet Military-Economic
Planning: The Role of the
State Planning Committee
The primary organization for directing the USSR's
economy is the State Planning Committee (Gosplan).
It assesses Soviet economic potential, advises the
political leaders on the impact and feasibility of
different policy options, prepares elaborate national
economic plans to implement the leaders' decisions,
and monitors the performance of the economy in
fulfilling the plans. Gosplan is the principal technical
authority on the Soviet economy's capacity to support
military efforts. At each stage of the planning process,
Gosplan personnel work to reconcile the competing
demands for resources advanced by civilian and mili-
tary interests.)
Gosplan was formed in 1921 to undertake economic
research and to prepare general plans as an aid to
Soviet leaders in making budgetary decisions. Mili-
tary interest in detailed military-economic planning
led to the establishment of a special directorate within
the Red Army Staff in 1924. This directorate coordi-
nated the plans of other military directorates, studied
the Soviet economy's ability to support peacetime and
wartime military requirements, and worked with Gos-
plan to ensure the satisfaction of these requirements.
In the late 1920s, Soviet leaders called for more
detailed and comprehensive central planning-includ-
ing military-economic planning. Gosplan established a
mobilization section in 1927 and a military-economic
department in 1928, which were staffed in part with
Red Army officers. Concurrently it prepared the first
Soviet five-year plan, which was adopted in 1929. F_
Shortly after the German invasion in July 1941, the
State Defense Committee (GKO)-the wartime
equivalent of today's Defense Council-directed Gos-
plan to prepare an economic mobilization plan for the
third quarter of 1941 and, shortly thereafter, to draft
the first of a series of wartime economic plans.
Gosplan worked with the General Staff, the armed
services, and the primary arms producers. To cope
with the new demands, it created departments subor-
dinate to its military-economic department to oversee
the newly formed peoples' commissariats responsible
for armaments, munitions, shipbuilding, aviation, and
tanks. In 1979 Soviet Defense Minister D. F. Ustinov
said that during the war Gosplan had been the
country's "true military-economic headquarters." F
Since World War II, Soviet maintenance of a large
military establishment and defense industry has kept
Gosplan heavily involved in military-economic plan-
ning. As the Soviet economy has grown in size and
complexity, Gosplan has undergone a number of
major reorganizations. It has also delegated or shared
certain of its planning functions with other agencies.
Gosplan has remained predominant, however, in the
highly centralized military-economic planning and
oversight of defense industrial production.F__1
Gosplan's Role in Soviet
Military-Economic Planning
Gosplan allocates resources for all major civilian- and
military-economic activities when it prepares and
oversees the implementation of five-year and one-year
national economic plans. Allocations to support de-
fense production are based on the general priority
given to the military by the political leaders. The
allocations also must be consistent with:
? Military procurement goals documented in Soviet
defense plans, which are drawn up for the same time
periods as economic plans.
? Specific development and production assignments
for major weapon systems, documented in decrees
issued by the Council of Ministers and the Commu-
nist Party Central Committee.
On the basis of national economic plan obligations,
the various ministries, republics, and--ultimately-
enterprises draft their individual plans.
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Gosplan Structure
Gosplan is organized as a microcosm of the Soviet
economy to deal with all economic interests and
oversee all economic activity. The Gosplan chairman,
Nikolay Baybakov, is a deputy chairman of the USSR
Council of Ministers and a full member of the Central
Committee. His 15 deputy chairmen are responsible
for industrial sectors and functional planning areas.
Baybakov, the deputies, and other selected officials
form a collegium that reviews major planning issues
and the performance of the economy.
The Gosplan departments fall into three types:
? Central planning, which includes national planning
and supply departments and the main computer
center. These maintain production and supply plan-
ning documents for the entire economy.'
? Functional planning, which includes the capital
investment, finance, labor, and new technology de-
partments. These help prepare plans for the nation-
wide development of their areas and furnish produc-
tion planners with data on available resources.
? Economic sector planning. Some of these depart-
ments oversee planning activities in individual min-
istries. Others deal with an entire industry, compris-
ing several ministries linked by similar product lines
or a major common customer; an example is the
department for machine building and metalworking.
Such industry departments work through branch
departments, each of which corresponds to one of
the supervised industrial ministries.
This organizational structure combines program and
line management.
Interaction With Other Agencies
Gosplan deals directly or indirectly with every compo- 25X1
nent of the Soviet economy, although to remain
effective it attempts to concentrate on issues that
involve large resource commitments or affect the 25X1
national economic plan.
Gosplan's military-economic
planning personnel deal primarily with the Military-
Industrial Commission (Voyenno-Promyshlennaya
Komissiya), the Ministry of Defense, and the party
Central Committee apparatus.
' The basic technique for supply planning involves the use of
material balances. The balance is a regularly updated compilation
of the sources of and uses for commodities. Sources include current
production, stocks, and imports, and uses include industrial con-
sumption (as intermediate product), final consumption (that is,
investment), inventory change, and exports. Gosplan itself main-
tains balances for approximately 2,000 critical commodities. The
national-level organ of the State Committee for Material-Technical
Supply (Gossnab) maintains balances for at least 7,500 other
commodities distributed on a national basis.F__-]
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Ministry of the Aviation Industry (MAP) Aircraft, aerodynamic missiles, air-to-air missiles, and defensive missiles (tactical and
strategic)
Ministry of General Machine Building Ballistic missiles, surface-to-surface cruise missiles, space launch vehicles, and spacecraft
(MOM)
Ministry of the Defense Industry (MOP) Conventional ground force weapons, solid-propellant ballistic missiles, antitank guided
missiles, tactical surface-to-air missiles, high-energy lasers, and optical systems
Ministry of the Shipbuilding Industry (MSP) Naval vessels, naval fire control systems, mines, torpedoes, submarine detection systems,
and merchant ships
Ministry of Medium Machine Building Nuclear weapons, high-energy lasers, and nuclear propulsion units and power sources
(MSM)
Ministry of the Radio Industry (MRP) Radars, navigation equipment, computers, guidance and control systems, and high-energy
lasers
Ministry of Machine Building (MM) Conventional ordnance munitions, fuzing, and solid propellants
Ministry of Electronics Industry (MEP) Electronic parts, components, and subassemblies
Ministry of the Communications Equipment Communication equipment, radar components, and electronic warfare equipment
Industry (MPSS)
Military-Industrial Commission (VPK). The VPK
oversees major weapon development programs and
parallels Gosplan in monitoring production in the nine
defense industrial ministries. The two organizations
work together to ensure that weapons programs are
appropriately reflected in the economic plans and that
resources are available. Except when large commit-
ments of resources are involved, Gosplan usually does
not concern itself with VPK directives on weapon and
equipment design, product mix, or production technol-
ogy. VPK personnel are sometimes involved with the
serial production of established weapon systems.
The Party Apparatus. The CPSU apparatus conveys
vital policy guidance to Gosplan departments and
helps them deal with such economic problems as
resource shortages. The CPSU Central Committee
has a Department for Planning and Finance Organs
that monitors the work of Gosplan and has industrial
departments that deal with their Gosplan counter-
parts. There is a close working relationship, for
example, between the party's Defense Industry De-
partment and Gosplan's military-economic depart-
ment. The parallels in organization enable Gosplan to
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carry internal questions into party channels for a
policy decision and enable the party to monitor plan
fulfillment.
and privileges in the process of preparing and modify-
ing plans, give the military a substantial advantage in
acquiring resources and protecting them from later
diversion to civilian problem areas.
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Because each of these organizations makes a unique
contribution to the defense management process, they
generally cannot overrule one another on matters that
overlap jurisdictions. Disagreements, which usually
reflect their divergent responsibilities, have to be
referred to the leadership for a decision. Ultimately,
the organizations must reach a consensus, because
their directives to industry must be consistent.__~
Military Preeminence in National Planning
Soviet leaders have traditionally given the military
preference in resource allocation. This initial advan-
tage is buttressed by several features of the Soviet
planning process, including Gosplan itself. Gosplan's
administrators delegate planning responsibilities with-
in the organization, which is highly compartmented
for security reasons. The effect of these factors is to:
? Increase the difficulty of evaluating the opportunity
cost of a given resource allocation (the value of what
would have been produced by a different allocation)
and the efficiency of resource use.
? Encourage all economic interests to be bold when
forecasting requirements and levying demands.
? Make extensive use of political techniques-appli-
cation of priorities, bargaining, and recourse to
higher authorities-for solving economic problems.
These effects, when combined with military priorities
Gosplan's Internal Operating Procedures
Central Planning. The personnel of Gosplan's central
departments theoretically have the authority to devise
an optimum allocation of resources in accord with
government policy and to enforce this allocation. They
have the right to evaluate alternative resource appli-
cations thoroughly and to compare the performance
and capability of all ministries and plants. In practice,
however, these departments have too little informa-
tion, equipment, and personnel to routinely perform
such rigorous analysis. They cannot rely exclusively
on measures of overall performance, such as sales or
profitability, because the administratively set Soviet
prices do not provide reliable measures of real produc-
tion value or cost.' And they cannot generate produc-
tion and supply assignments that are detailed enough
to be incorporated directly in national and ministry
plans.'
The central departments' planners therefore leave
detailed planning of production and supply to their
colleagues in the sector and branch departments.
Personnel in these departments check the planning
done in the industrial ministries and attempt to issue
assignments in sufficient detail to eliminate potential
for misunderstanding or evasion. Personnel in other
' The Soviet economy is chronically in a state of disequilibrium-
that is, prices are not allowed to fluctuate to equate demand with
supply. Thus, the sum of the costs of the materials needed to
produce an item-its "resource cost"-is a poor indicator of its
"opportunity cost," or the value of goods that could be produced
with the materials in other applications.
6 Although the central departments make extensive use of comput-
ers, they cannot build and run a model large enough to compute the
optimum allocation for the thousands of products that must be
planned for at the national level. And even if such a model were
technically feasible, the central planners would require much better
economic data before they would rely heavily on the model's
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state agencies, republics, and ministries further elabo-
rate these targets and allocations. As a general rule,
when planners see a new problem or a new opportuni-
ty, they try to deal with it at the lowest feasible level,
whether in Gosplan, the ministries, or the republics.
Many resource decisions are made by the individual
enterprise concerned, sometimes with participation of
a local planning or supply official.
This pyramid of decisionmaking generally balances,
on paper, the nation's resource supplies with the
government's production plans. But its main pur-
pose-to ensure that production is carried out in full
accord with the leadership's instructions-is not al-
ways achieved. Among the many decisions made at
lower levels and leading to diversions of manpower,
equipment, or materials from the original planned
recipients, some involve substantial loss to the sector
deprived. Soviet literature,
indicates that central planners-and ulti-
mately the leaders themselves-can seldom measure
these opportunity costs. Gosplan does not routinely
evaluate the range of civilian options foreclosed when
specific resource commitments are made in military
production programs.F__-]
Negotiation of Differences. The authority of Gos-
plan's central departments is further limited by the
political features of the planning process. Gosplan
provides a forum for debating and reconciling differ-
ences among competing economic interests. The per-
sonnel in the industrial departments represent their
constituent industries and frequently are hired from
the ministries they are to oversee. If central depart-
ment personnel detect an inconsistency in the plan,
they may outline alternatives, but they cannot unilat-
erally modify a ministry's plan assignments. The issue
must be taken up with all concerned departments and
managers, and it can also involve party, government,
and military officials.
Compartmentation. Finally, security considerations
circumscribe Gosplan's procedures, particularly on
military-economic issues. Only the top Gosplan man-
agers and the key personnel in the central depart-
ments are informed about all Soviet economic activi-
ties, and military-economic information is restricted
to Gosplan defense channels. Most Gosplan personnel
do not know what resources are channeled to the
military.
Preparing Plans
Soviet leaders establish defense spending and program
targets early in plan preparation, before other targets
are specified. Thus the military is among the first to
make specific claims for resources. Receiving these
claims, Gosplan determines the industrial assignments
necessary to meet them, their general impact on the
economy, and the allocation of remaining resources to
other claimants. The military-economic department
has an important role in this process. It conveys
military demands to Gosplan's central departments,
defends them, and translates the general targets and
allocations (for example, millions of tons of steel) into
specific directives incorporated in defense industrial
plans.
If Gosplan had the technical capability to establish
and adjust the military and civilian economic plan
targets simultaneously, the military advantage might
be reduced. Without that capability, this "military-
first" approach to plan preparation severely limits
possibilities for considering civilian alternatives-even
though it does not guarantee acceptance of all initial
military demands. Once military requirements are
established, Gosplan's civilian departments or the
civilian ministries can propose revisions-but only
minor revisions are likely to be granted.
Civilian interests occasionally seek a hearing on major
grievances in the Council of Ministers or another
leadership body, but they are hindered in building an
effective case by difficulty in learning about the
defense applications of the contested resources. In
contrast, the General Staff routinely reviews civilian
industrial planning, and it proposes changes to any
allocations that it believes may jeopardize military
requirements.0
Adjusting Plans to Changing Conditions
If it proves impossible to meet all plan targets and
contractual obligations, industrial managers can at-
tempt to compensate within their own operations (by
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adjusting product mix, delaying deliveries, or lowering
quality standards) or to negotiate special arrange-
ments with their suppliers or customers. Both options
are easier to exercise in civilian matters; their latitude
in military R&D and production is quite limited
because such activities are:
? Singled out in national and ministry annual plans by
detailed specification of production quantities and
deadlines.
? Covered by party and government decrees specify-
ing weapon technical characteristics and identifying
the responsibilities of all participants in a given
weapon program.
? Monitored carefully by VPK and Ministry of De-
fense officials and on-site representatives.
? Tied closely to financial incentives and career
prospects.
For all these reasons, it is usually easier and more
remunerative for managers to meet their military plan
obligations and adjust their civilian commitments if
they must.
When a manager is unable to compensate within his
own operation, he must request a plan adjustment
from officials in his ministry; and frequently they
must go higher, to Gosplan officials. Soviet leaders
and planners recognize that because of planning
errors, unforeseen shortages, and policy changes some
adjustments inevitably are necessary. The leaders, as
a general rule, will agree to change the plan-when
the benefits of the change outweigh the costs (the
erosion of planning discipline, increased burdens on
planners, and the disruption of industrial operations).
The planners, however, resist such requests, knowing
that a significant change in a single plan can cause an
ever-widening series of adjustments in the plans of a
whole chain of affected ministries and establishments.
During a visit to an organization of the Ministry of
Chemical Industry in 1977, Premier Kosygin report-
edly stated that the Council of Ministers had to
decide a large variety of trivial issues. He added that
the Council sometimes is helpless to correct original
plan figures because one issue touches on many
others, with the only outcome an "endless circle of
meetings."
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Resolving Disputes
Although Gosplan is organized and operated to facili-
tate consideration of the views of all economic inter-
ests, it frequently must take positions that disappoint
some of them. Gosplan personnel routinely face chal-
lenges on their interpretations of national policy, their
assessments of industrial capabilities, their estimates
of the resources required to fulfill plan assignments,
and their judgments on specific adjustment requests.
They avoid troubleshooting in plants and institutes
(unlike military representatives, VPK officials, and
regional party officials) but spend considerable time
reviewing appeals of decisions made at lower levels in
the planning hierarchy.
Whether Gosplan prevails in a dispute depends on the
issue in question and the parties involved. It normally
prevails in disputes between itself and a ministry
(whether defense or civilian). In any dispute, each side
typically enlists allies wherever it can find them, at
the highest level it can reach, even among the top
leaders. F__~
Gosplan is under great pressure to reverse the recent
decline in Soviet economic growth. Brezhnev and
other senior officials have been extremely critical,
assigning it a major share of the blame for the
economy's deteriorating performance. A number of
senior Gosplan managers have been dismissed, and
others, including Chairman Baybakov, have publicly
acknowledged Gosplan's shortcomings..So far, the
Soviet leaders' main response to economic difficulties
has been to centralize economic decisionmaking even
more. In particular, they have strengthened the au-
thority of Gosplan in relation to ministries and other
state committees (the specific new powers have not yet
been publicly outlined).
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Concern over slowing economic growth will increase
the pressure on policymakers and planners at all levels
to channel resources to growth-oriented activities,
particularly industrial investment. The military and
other defense interests probably will be obliged to
prepare even more thorough justifications for their
requirements and be prepared to argue their case 25X1
against the claims of critical civilian problem areas.
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In the competition for resources, Soviet leaders, with
Gosplan counsel, clearly will determine the military's
overall position. Nonetheless, the specific allocation
problems and decisions will be confronted on a daily
basis in Gosplan departments, and the interplay of
these departments can substantially influence the
implementation of Soviet economic policy. The mili-
tary, therefore, has a strong incentive to retain its
influence within Gosplan
Several changes are taking place within Gosplan that
could affect military interests. One is an effort to
expand substantially the application of computers and
mathematical techniques in planning. This program
(to be completed by 1985) is designed to expedite the
transfer and processing of a larger quantity of data, to
permit more complex calculations, and to create
automated linkages between planning centers-Gos-
plan industrial departments with the central depart-
ments, and Gosplan with ministries and republics. It
is hoped that these changes will increase the capabili-
ty of central departments to make comprehensive
assessments and thereby enable central planners to
better evaluate alternative resource applications.=
The goal of this program, as outlined in Soviet
literature, is to enable Gosplan's central departments
to issue a more detailed set of targets directly to
ministries. This would reduce the authority of the
industrial departments-including the military-
economic department, if the procedure is extended to
military-economic planning. To date, however, plan-
ning has been effectively computerized only within
individual Gosplan departments. This limited imple-
mentation could actually increase the departments'
independence from the central departments and
thereby have an effect opposite to the one intended.
A second change is the introduction of a number of
new faces in Gosplan management; but the signifi-
cance of this is not yet apparent. There is no reason to
expect that Voronin, the new first deputy chairman
for defense, will be any less dedicated to, or less
capable in serving, military interests than his prede-
cessor. Indeed, as the former manager of Soviet
programs for tank development and production, he
has considerable experience in defending military
interests in an area where there are important civilian
applications for resources. In February 1979 Ya. P.
Ryabov was relieved of his position as party secretary
for defense affairs and appointed a first deputy
chairman of Gosplan, with apparent general responsi-
bility for several technical and regional economic
programs. Explanations for his transfer range from
leadership dissatisfaction with his performance to
plans for him to succeed Baybakov. About one month
earlier a Ryabov protege, N. I. Ryzhkov, was appoint-
ed a Gosplan first deputy chairman with responsibility
for civilian heavy industry. With these changes, the
military may have gained additional sympathetic
officials in key Gosplan positions.
In addition, a major reorganization of Gosplan was
completed in the fall of 1981. It is not clear what the
reorganization was intended to accomplish or how
We do not know if these changes have affected the
position and authority of the military-economic de-
partment. The military could benefit substantially if
that department were given increased control over
resources in short supply or over the civilian minis-
tries' production for the military. The military could
lose substantially if any measures reduced the insular-
ity of the department. For example, the department
could be merged with the civilian Machine Building
Department (which deals with ministries having tech-
nology and output similar to those of the military), or
the central planning departments could be given more
authority to deal directly with the branch depart-
ments overseeing the nine defense industrial minis-
tries. This would make it easier for civilians to
compare civilian and defense industrial use of re-
sources.
We believe that the military will succeed in maintain-
ing and possibly improving its strong influence within
Gosplan. Although Gosplan's future depends on how
well it deals with current economic difficulties and
accommodates the views of new leaders, continued
Soviet adherence to the idea of tight central planning
probably rules out major shifts in Gosplan functions.
Continuation of the existing military-economic plan-
ning organization and procedures will advance the
efforts of the Soviet military to maintain a preferen-
tial position in the economy.
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Appendix
The Economic Planning Process
Gosplan formulates national economic plans for one
year and for five years and prepares longer term
projections for 10 to 15 years. The five-year plan is
ostensibly the basic document charting the course of
the economy. Starting with the generalized targets in
long-term forecasts, it establishes concrete goals for
each year of the period. These goals form the basis for
the detailed assignments and allocations contained in
the annual national plans (see figure 3). (Annual plans
can be adjusted to reflect major developments that
occur after the five-year plan is prepared.) Republics
and ministries formulate their five-year and annual
plans on the basis of the tasks assigned to them in the
national plans, while institutes, enterprises, and other
facilities formulate plans on the basis of assignments
from the ministries. Gosplan receives considerable
assistance from other management organs and eche-
lons, which undertake much of the planning detail,
but is held responsible for the internal consistency and
impact of the entire network of plans.F_-]
the process of preparing plans
is similar for the five-year and one-year periods. The
following discussion focuses on the longer term se-
quence.n
Gosplan begins preparations two to three years before
the five-year plan is to come into force. Using macro-
economic models of the Soviet economy, it assesses
growth prospects and the potential impact of major
alternatives in the allocation of resources. These
assessments provide the framework for the key eco-
nomic policy decisions. When the general policy guid-
ance has been established, Gosplan uses these same
calculations to formulate preliminary options.F__-]
After Central Committee endorsement, Gosplan de- 25X1
partments review the plans that have been drafted at 25X1
the same time by the republics and ministries and
begin to calculate supply obligations between industri-25X1
ministry counterproposals
they serve as the conduit for Gosplan instructions and
draft plans and negotiate compromises with Gosplan.
Gosplan ministry departments are most instrumental
in the negotiations of the final planning stages when
publics and ministries, which then have to revise their
al sectors and ministries. The departments transmit
preliminary assignments (control figures) to the re-
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25X1
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Figure 3
Interrelationship of Soviet Economic Plans
Period of the Plan
10-15 Years
Ministry/Republic
Plans
Ministry/Republic
Plans
Ministry/Republic
Plans
Final approval of both the five-year and the annual
plans rests with the Politburo. This approval is largely
a formality, since throughout its preparation the draft
is adjusted in accordance with Politburo guidance.
When the government legislative arm, the Supreme
Soviet, nominally confirms the plans, they have the
force of law. Politburo and Supreme Soviet approval
are to be completed before 1 January of the year when
the plan goes into effect. Policy disagreements or
unexpected late developments frequently delay com-
pletion of the five-year plan, but the plan for the first
year of it usually is approved even if the overall plan is
held up. The assignments of the one-year plan will
have been prepared to accommodate the anticipated
assignments in the draft five-year plan.
The approved five-year and annual plans govern all
aspects of Soviet civilian and military-economic activ-
ity. Major chapters of the plans are devoted to
production, supply, technology, and finance. The
plans stipulate two kinds of objectives:
? Specific degrees of overall performance improve-
ment (such as production growth and cost reduction)
for the nation, ministries, and republics.
? Specific research and production assignments for
costly or high-priority projects and products.
They also stipulate most of the material and financial
resources that will be dedicated to meet these objec-
tives. F_1
For additional information on Soviet economic plan-
ning, see Alec Nove, The Soviet Economic System
(London: Allen G. Unwin, 1977); Martin Cave, Com-
puters and Economic Planning: The Soviet Economy
(Cambridge: Cambridge University Press, 1.980); and
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