ECONOMIC - ORGANIZATION, PLANNING

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000600150058-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 10
• Document Creation Date: December 22, 2016
• Document Release Date: June 15, 2011
• Sequence Number: 58
• Publication Date: October 28, 1952
• Content Type: REPORT

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:OI 'iiOL
JS OFF?Ie_. JN T
CLASSIFICATION S E-C-R F-T
SECURITY INFORMATION
CENTRAL INTELLIGENCE AGENCY REPORT
COUNTRY German Democratic Republic
SUBJECT Economic - Organization, planning
DATE OF
INFORMATION 1951
DATE DIST.4f Oct 1952
SUPPLEMENT TO
REPORT NO.
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At its meeting on 6 December 1951, the Miniatori.el Council of the GDR
drafted the "Decree Concerning the Improvement of Waterial Planning and Organ-
ization of Material Supply" and therein laid down principles for the work of
the material supply organs in 1952.
Or, the basis of the decree, which emphasizes the great 2Wortance of ma-
terial planning and the organization or material supply for the increasing
tempo of the GDR economy, the following tasks in particulaP mist be performed
in 1952:
1. The State Secretariat for Material Supply will concentrate its work
more intensively than formerly on material planning, on direction in all basic
problem,, and on the systematIt. supervision of the supply of materiels for the
GEE economy.
THIS IS UNEVALUATED INFORMATION
PRINCIPLES GOVERNING MATERIAL PLANNING AND ORGANIZATION
OF THE GDR SUPPLY SYSTEM IN 1952
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COITROL f US OFFICIALS ONLY
CLASSIFICATION g- --'A-I
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' ws
2. The operational work in directing the execution of the plan and in
current distribution will to a great extent be transferred to the appropriate
ministries and state secretariats with portfolio. This includes the direct
management of most of the DHZ (German Trade centers).
3. The basis for material planning, and the most terse- :ant meant of
developing a frugal economy, is the establishment of material consumption
norms. The State Secretariat for Material Supply will increase its control
over the development of consumption norms and over compliance with them, and
will also exmmi and confirm the norms worked out by claimant gencies Kan-
tingenttraeger Jprimary recipients of allocations of material
The main emphasis of the work of the State Secretariat for Material
Supply is to be on the exact determination of requirements, and, on the basis
of this determination, the balancing of requirements against supplies avail-
able.
5. Along with the development of material consumption norms, improve nt
in the planning of requirements and distribution, and the introduction of the
General Contract System, the claimant agencies are also faced with significant
new tasks. The fulfillment of these tasks will require a considerable simpli-
fication of work methods, especially relief from the operational details of
6. Material accounting is of greet importance immaterial planning and
the development of a fr gal economy. So far; this has not been properly
handled and _-at therefore be further developed. methodologically.
On the basis of these premises, the following principles and explanations
have been laid down for material planning, organization of distribution, and
accounting in 1952:
The State Secretariat for Material Supply has worked out the material bal-
ance figures for 1952 on the basis of the material requirements plan for 1952
turned over to it by the claimant agencies, using material consumption norms.
In contrast to the old practice, even those items have been balanced which
are under the "facilita?red movesfent of goods" system La systWa whereby consum-
ers can procure certain c itiea directly from producers, without going
through the usual cdanne1 This means that requirements will have a greater
influence on production and imports. At tee same time, the prerequisites are
fulfilled for compiling totals, by value, of the various individual items,
first by categories, than by plan groups, and finally by tota'. supplies and
their distribution, as an integral part of the balance figures for the planDed
economy.
The balances show the distribution broken down by claimant agencies and
by utilization in the economy (for example, production and other rational
consumption, investment consumption, consumption by the populations Balance
figures with these breakdowns fora the-basis for integration with the various
production and performance plans of the Economic Plan (production plans, in-
reetment plans, piano for p.ovidin? goods for the population, etc.) and are an
important means of discovering and avoiding disproportion between the plans
for developing the different branches of the economy. The balances thus are a
means for integrating the various parts of the plan with one another, and serve
at the same time as a distribution plan.
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IZ.. TURETI1G OVER PIaA1S TO CC*PETENT MINISTRIES, THE STATE SECRETARIATS WITH'
PORTFOLIO, AND THE ( RMM M DE CENTERS (oRQ0S FOR BIECUTIEG THE DZS2Ri9UTIOIi
PLAT) TO BE PLED UNDER THESE : IST : S AND STATE SECRETARIATS
With the transfer of the DM, the ministries and state secretariats with
portfolio assume responsibility for the execution of the material distribution
plan, including ,compliance with) the pertinent instructions of the State Sec-
In accordance with the Decree on the Improvement of the Work of the Ger-
man Trade Centers, of 6 December 1951, the competent ministries or state sec-
retariets wihh portfolio, or main administrations under them, are to form
and state secretariats with portfolio, and in carbon copy to the DEl, in thee
form of the materials balance sheet, form M 591. This sheet shows for each
finch agency).
A. Balances for "Z" Goode (Goods Distributed Centrally)
These are the balances for the most important raw materials, primary mate-
ri.al9, fuels and auxiliary materials, equipment, and finished products. Allo-
cations for these goods are made only by the State Secretariat for Material
Supply, which also has jurisdiction over all amounts which may become avail-
able from surplus production, operational reserves, returned allocations, etc.
Such goods are designated in the material pia:, and in the balance sheets by
the letter "Z.'
B. Balances for "M" Goods
These are the balances for goods which are distributed by the ministries
and state secretariats with portfolio according to the amounts specified in the
balance aheets, either through claimant agencies or directly through the DBZ.
The ministries and state secretariats with portfolio have the particular
right, subject to directives from the State Secretariat for Material. Supply,
to distributed reserves= returned a)..locations, and any amounts of these goods
accruing from surplus yroduction.
In 1952, some of the "M" goods will still be allotted to claimant agen-
cies, consumer groups, and individual consumers against administrative release
orders valid for the "Z" goods.
These goods are designated in the material plan and in the balance sheets
by the letter "M."
Other _14" goods, which are designated in the material plan and in the
balance sheets by the 'letter "!+," do not hove to be a".ctted against adminis-
trative release orders. These are either goods the final disposition of
which has already, been determined ,-either in connection with their production
ar in the investment plan (especially heavy equipment), or goods the supply of
and demand for which are properly balanced, which therefore can be procured
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by the consumers according to their needs, as in the case of goods previously
under the "facilitated movement of goods" system, either through the proper
DRZ or directly from the D EE.
The balance figures for the "i6" goods thus determine the framework for
distribution by the ministries and state secretariats with portfolio.
for 1952 to the claimant agencies in the form of. (a) supply balance,
't'his new part of the plan was introduced especially to provide an oppor-
tunity to determine the rcletive size of allocation.. for a given claimant
agency and also to determine for each claimant agency to what extent other
supplemental sources of supply must be developed.
groups, and a total, by value, of the entire amount of allotted materials.
ures for 1952, including the compilation of tota7.e by categories and plan
In the supply balance form M 592, the following is shown for each item:
1. The requirement for 1952, calculated according to current norms and
checked over.
2. The savings for each item, based on the total savings in the value of
materials specified in the Law on the 1952 Economic Plan.
Since requirasnts be been cWculated on the basis of norms current at
the beginning of the plan year, or on The uabie of experience, the use of a
factor for savings is justified in balancing supplies.
PrsrW-% espsaie cos-shrks that the growing initiative of the working
people in improving norms, making butter use of materials, improving tech-
nology, and eliminating exaggerated eafbty factors and the like, with result-
ant conservation of materials, must be accorded consideration as an istagral
component of the balances.
3. The approved cover of requirements, which consists of the calculated
requirements minus the amounts to be saved; this cover'of requirements at the
same time represents the recognized ,onsu:'eption.
The cover of requirements. is broken down into two parts, specified
as follows:
a. The planned allocation-(allocations from production, I pcrts,
and other-sources of stippi.y), for amounts to be obtained from deliveries or
from a plant's on-u production; so far as the goods concerned are those on the
list of goods which aro to bo reported in gross for the Industrial Report
(IM), i.e., goods for which the plant receives a gross-production plan.
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materia.?a accumulated in the plant itself
Supplies from do eetic reserves; these. include the following:
Reserves (*2t*rJal mar 1st `a publication listing materials offered for sale bar
various enterprise
Tho annual allocation will be given to the claimant agency in the form of
the material plan (allocation plan M 593). The material. plan will contain all
items for which the State Secretariat for Material Supply has set up balance
figures for 1952, including the groupings by categories and plan groups and
the compilation by value of all materials allocated undtr the plan. The State
Secretariat for Material Supply can avecify definite amounts in the material
plan for quarters or months or for purpose or project.
The material plan (allocation plan M 593) is the basis fuc the allocation
of materials by the claimant agencies to the cmiaumer groups and individual
consumers. No breakdown is to be made in the material, plan for the categories
or for the items in the plan which are designated M +. Thus, it is the items
designated "Z" end "K" 'w'hich mist be broken down.
1. Thd central claimant agencies distribute allocations to the consumer
groups under them by mans of distribution notice ICI 5934. A copy of this
notice is to be sent to -the central ~oanagament of the DEZ which has jurisdic-
tion over the goode in question, the name of which is smtered in Ca1.imsn 3
opposite the item in the uwAae.3aturs list of the material plan.
The consumer groups distribute the allocations received via distriba-
tion'notice M 593a to the consumers under them by means of distribution notice
M 593b.
G3ma.--xnt a oncies do not use fora i 5;3s for the d`st 'ibuti.n
locations to conspilerp directly subordinate to then, but fora N 593b. It
al- .
such cases the claimant agencies must send the third carbon copy of -lors
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A 593b to the cent-Al tanageaaent Of the appropriate DIM. On this form, the
let-ter "D" is to precede the five-digit code number of the claieant agency,
to indicate that this allocation was made directly.
receipt L the fora? by the consumer,
o
of form M 593
and the items in question. These copies are to be forwarded immediately upon
The consumers send two copies (directly subordinate plants 'one cdpy)
branch of the DEM which has Jurisdiction for the area
b t
M 593e to the consumer groups under them ysucn as couuca..c.m ---7-
supply offices of t-=e municipal and rural F`reise).
-J..um ..- rument recei4eS
named by the Dd E to execute the material plan of the Land 90v'-'
~nnmrmAr areums distribute the allocations received via distribu
.tion notice M 593a to the consumers ba means or roras ai :)Y-19-
and performance plans.
According to Paragraph 1, Section 4, of the Decree Concerning the
Introduction of the (armed Cont-*ct System, the chiefs of the orga-ne con-
cerned are responsible for conclusion of the contracts. If they refuse to
conclude a contract, or if .they are responsible for delaying the conclusion
of a contract, this is to be consideredis a breach c for prosecution i.nde~tbey
havior prejudicial to the economy, er
current penal regulations.
o o
The regnirearnt asrigTments
which sine. not distributed vi* form M 593b? In this case, the plan
are considered to have been wade known on the date oee?which the consuaar re-
ceives
the awnut of which itswfniaed by the production
pplies to all needed itemee output
as claimant agencies, are reSpouraa.usu r..,_v.,_---- , ---F_-
for the distribution of very small quantities, especially within the Ereise.
The state contract offices, as consumer groups, distribute materials
for processing to the other plants on the basis of previouniy ermined and
registered contracts and cu the basis of justified and approved demands for
materials, using the forms which h,?-e been in use previously.
Supplemental regulations on the method of distribution vithin the
I.aender will be given out later,
on - --
3. According to the Order on .. the Tntroduct-- of the General Contract
System for Deliveries of Goods in People-Owned and Equtralent Plants, of
6 December 1951, consumers are required to conclude contracts covering
mutual relationships resulting free the Economic Plan which pertain to the
delivery and receipt of basic and raw materials, semifinished and finished
goods. According to Paragraph 2, Section 1, of this decree, the contracts
must be concluded not later than one month after the plan assigments are
Bede known.
So fez as consumers are concerned, the plan aesigments are cOp-
sidered to have beam made known at the time MM M 593b is received free the
cn.,,mer group or fron the claisant agency.
.iclude contracts applies also to thoss+ goods
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their allocations under the plan as 91reserve of the claimant agency." Raw-
ever, the breakdown of this reserve must be made promptly enough so that the
consumers who receive allocations from this reserve can give their orders to
the DEZ or plants soon enopgh for the goods in question to be produced or im-
ported in accordance with requirements during the proper plan period.
V. DISTR TIQN OF ASSI IN COI CTIOH WITH Y CUTION OF THE MATERIAL P7
Itoks of State Secretariat for Material Supply
The State Secretariat for Material Supply will concentrate in the future
primarily on the following tasks in connection with material planning and ma-
terial distribution:
1. Promoting the establishment of economical material cousumption norms
as a basis for planning requirements and materials distribution, and also as
a means of checking on proper consumption of materials and confirmation of
the basis oe consumption norms and the material requirements plans of the
claimant agenc?es.
4. Distributing the most important raw materials, materials, and finished
products ("Z" goods) during the current plan year.
5. Laying down the regulat'ons for the dibtribution of other goods by the
ministries, state secretariats with portfolio, and DHZ on the basis of balance
sheets and directive worked out by the State Secretariat for Material Supply.
6. Promoting the frugal utilization of materials end the establishment
of a systematic control over consumption of materials, material reserves, and
adherence to approved consumption norms, by means of an improved systea of
accounting.
7. Laying down the principles governing the movement of goods and tb*
contracting system and promoting the establial=ent of long-range relation-
ships throu6hcrst the economy.
8. Organizing a batter utilization of domestic and local reserves an
well as an increased use.. of substitute m.. terials in place of goods which
have to be imported and other goods in short supply, and more extensive use
of domestic raw materials for purposes for which they have not previously
been used.
The execution of these assignmants is possible only if the State
Secretariat for Material supply is relievcd to a great extent of all opera-
tional functions in connection with the distribution of goods, especially the
processing of current supplemental demands for material allocations above or
in addition to the pion, and the direct supervision and control of the work
of the Drt,, that is, the direct control of the execution of the plan.
According to the Decree of the Ministerial Council, these operational
tnwln ere to lr t~+wnnf.-rw.~ 4.n fhb nintafr je9 wnri ti- w4 std a~rr~hwr4A4 -4th-
portfolio.
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D. Assi ia- pts of Miai~trieca and State Secretariats With "ortfolio
The ministries and state secretariats with portfolio, and in particular
n-
s
i
i
g
ng a
s
the working groups to be formed by them have primarily the follow
ments:
1. Control over the execution of the distribution plan and assurance
of accounting for all goods.
f the distribution of all "M" items on the basis of the
ti
ve o
2. Direc
balances worked out by the State Secretariat for Material Supply, with regard
not only to distribution but also to the source of supply (production and im-
port).
This includes in particular:
a. Breaking down the balance figures received from the State Secre-
tariat for Material Supply according to a more detailed nomenclature, ir. order
oods
ts of
t
g
men
to balance requirements and supplies~even for individual assor
the setting up of deliver;; plans for specified mate-
Initiatin
b
g
.
rials in order to work out a long-range ~.e'livery program for especially im-
portant plants or especially important goods.
Deliver, plans provide a breatdcnau of the distribuLivu, -Which is
specified in the balance sheets only in general terms, taking special consider-
ation of economical use of transportation and of practical requirements with
regard to assortments and quality.
c. Systematically exercising control over the execution of the dis-
txioution plan, especially with regard to:
The breakdown and specification of allocations by the claimant
agencies and the consumer-groups. .
The conclusion of contracts by the consumers.
The observance of the regulation, ux the Decree Concerning the
Introduction of the General Contract System in the conc:us9on of contracts.
Assurance of delivery of key materials on schedule.
Proper recording,, of the allocations by the DHZ.
Plan accounting by the DHZ.
d.. F.ocessing supplemental demands for all "M" items for release in
addition to or outside the plan from the operational reserves specified in the
balance sweets end from e.lwoca}?ons returned, especially the d cision as to
whether the release is to be granted on the basis of such demands.
e. Controlling the distribution of those "M" goods which are not al-
located to the com umern+ by means of administrative allocation forms, and mak-
ing decisions on all problems connected with the distribution of these goods
vitrin the framework of the balance figures set up by the State Secretariat
for Material Supply and the directives which are handed down.
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It must be particularly pointed out that the tasks of the miflistries end
of the state secretariats with portfolio in connection pith the ercutiou of
th distribution of all supplies Of' the goods
e
~
tries for the execution of the tasks assigned ..o ar
c
secretariats with portfolio n
own consumers. For this reason, the working groups to be set up by the minis
a no* to be incorPor?-
tk
These tasks are not to be confused with the tasks of the Ministries and
onnection with suppl;ring materials to their
i
ordina to rem Ctive ministrlee and at a iffieCretariaS4 airrra MI-1011-
but eztenda in a de to the distribution of slieffi frogs any aource in
the sca>aaxrr, 2nclradS~na imparts.
the distribution plan inclu e
in question.. 'T'hat?-'~es ueibili ,--qua in no we limited to marketing thrase
i atribution .plan w3xich_are prodva ~ n T___-,_ia
VI. RE STS FOR ALLOCATIONS OF MATERIALS IN ADDITION TO AND OUTSIDE TEE
zrr em Mwn T1I PRESSING OF SUCH REQUESTS
f ver 1arne nuxstir of current requests for allocations
a
ranted lylieavyytL=tu on both t ? ratan of the State 3Cre
Supply and the claimant agencies and has kept them from the important tasks
of developing norms, calculating exact requirements, supervising consumptiuu,
and accounting.
bad.,
In the past, a large number of the supplemen~~iequerequests
hhave not ave serious
sufficient Justification. In general, they were efforts having been made to find other means of covering the requirements
(shifting of materials, diversion of unused alloeMations, use of substitute
materials full utilization of local reserves, etc.). In particular, the
inventory of reserves of metal products taken on 3V A gust "?- on form
M 518 confirmed this.
This situation must end in 1952.
J
The proimg o
of materials -.n -adfition to and outside the plan has to date been an unwar-
tar int for Hater is!
The M 19 procedure for requesting allocations from. e StatBecreterlsn
for Material Gur2ly will be discontinued. In 1952 , allocations
in addition to and outside the plan will be made only if:
1. Supplemental assignments have been made under the plan, or the ful-
fillment of key tasks under the Econaisic Plan depends on the supplemental a'-
lcrcatioras .
2. It is Shown that the pinned allocrtions have beer. completely
realized and that proper use has baen bade of them.
3, The claimant agency has no reserves of ito own and there are no
other possibilities of any alternativec.
If the shove conditions for requesting supppllemenntaltallooccaatio s any of special
goods are met, the claimant agency may sbmit
form, together with a detailed justification-and explanation. These requests
for "Z" goods meat be signed by th.. Meister competent to sign for the claimant
agency in question or by the state secretary, in the case of a central claimant
agency, or by the chief of the Main Department for Material Supply of a Land
government.
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Form p& 19 may continue to be used for sutmitting requests from. Cousuars
or consumer groups to their respective claimant agencies.
Form K 19 may also be used for submitting to the ministries requests
from csdais at ncies for allocations of "X" goods in addition to or cutside
the 'Finn. iu this- i;*se, ciao, the a"vova-cautioned conditions rurat be 7a ?t.
Such requests u t, be signed by the chief of the appropriate ;gain depertttent
or daspartaeut for wterial supply.
1. The procedure for plan accounting (frr,s the standpoint of deliveries)
and for accountiaKg of receipts, consumption, and reserves of materials for
1952 (X 32)
2. Methodological details on individual peculiarities in connection
pith the distribution of certain goods and groups of goods
3. Peculiarities in the distribution methods of the hand governments
(contract offices, hand trades, consumer cooperatives, BCreiue, etc.).
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