Guaranteed Remuneration of Labor

on kolkhozes the form of distribution of the gross income. In the system of guaranteed remuneration of labor every kolkhoz member, under conditions of an average level of productivity and labor intensity, receives regularly from the collective-farm economy a guaranteed minimum of personal earnings in money and kind, regardless of the results of the productive activity of the kolkhoz. A differentiation in the amounts of remuneration of labor, according to the results of production and differences in the labor productivity of the individual kolkhoz member, is obtained from part of the income surplus above the sum used to pay this guaranteed minimum. Guaranteed remuneration of labor is widely applied on the kolkhozes of the USSR and on the agricultural cooperatives of all European socialist countries, usually in the form of direct money payment.

The introduction of guaranteed remuneration of labor on the kolkhozes of the USSR in 1966 was prepared by the economic policy of the CPSU and the Soviet government, which was aimed at strengthening the kolkhozes. The improvement of the material and technical base of the kolkhozes and the regularization of taxation and of the system of procurements and price formation accelerated the development of the economy of the kolkhozes and contributed to increasing incomes. Thus, between 1958 and 1965 in the USSR, the gross income of the kolkhozes (for a comparable set of farms) increased 62 percent, with the average annual money receipts per kolkhoz member increasing 2.1 times and the personal earnings of every kolkhoz member rising 72 percent. This increase reduced the discrepancy between the levels of earning on the kolkhozes and sovkhozes. Whereas in 1958 the average annual earning of a kolkhoz member amounted to 52.2 percent of the wage of a sovkhoz worker, this figure rose to 66.3 percent in 1965. By the end of 1965, 52.1 percent of the country’s kolkhozes were able to remunerate the labor of kolkhoz members on the level of the sovkhoz worker’s wage. Taking into account this trend, the Central Committee of the CPSU and of the Council of Ministers of the USSR by its decree of May 16, 1966, entitled On Increasing the Material Incentives of the Kolkhoz Members in the Development of Collective-Farm Production has not only advised the kolkhozes to introduce guaranteed remuneration of labor but also granted them direct material guarantees in the form of long-term bank credits on favorable terms. On Jan. 1, 1971, a total of 99.9 percent of the kolkhozes had introduced guaranteed remuneration of labor. To ensure the established level of the guaranteed remuneration of labor, the guarantee fund is the first to be formed at the time of the distribution of the gross income; this guarantees a regular monthly payment of earnings. If a kolkhoz’ own resources are not sufficient, the government grants it a long-term credit; the amount of the credit is determined by the difference between the sum of resources needed to remunerate the labor of kolkhoz members according to sovkhoz wage rates and the kolkhoz’ own resources earmarked for this purpose. Parallel to the system of guaranteed remuneration of labor computed at sovkhoz wage rates for jobs fulfilled or for time put in, kolkhozes also use the system of remuneration according to the quantity and quality of the output obtained, including the system of additional remuneration of labor.

The introduction of guaranteed remuneration of labor led to an increase in the personal earnings of the kolkhoz members paid from the collective-farm economy, especially on kolkhozes with a relatively low income. Whereas in the 1965-69 period the per capita income increased 34.8 percent for the USSR as a whole, it increased 64.9 percent on the kolkhozes in the northwestern region of the RSFSR. The unjustified gap between the levels of remuneration for the labor of the kolkhoz members and sovkhoz workers has been reduced through a rise in the earnings of the kolkhoz members. Thus, for the RSFSR the remuneration of the labor of kolkhoz members increased as follows: the pay for a man-day increased from 2 rubles 75 kopeks in 1965 to 3 rubles 83 kopeks in 1970. With the general increase in overall earnings of a kolkhoz family, the structure of those earnings has changed. The relative share of the earnings from the public economy has increased. This strengthens the kolkhoz members’ interest in the work of the collective-farm economy, increases labor activity, and promotes the growth of labor productivity and a general rise in the efficiency of production. Guaranteed remuneration of labor promotes the development and strengthening of profit-and-loss relations on the kolkhozes.

The system of guaranteed remuneration of labor established on the kolkhozes of the USSR determines the minimum level of the remuneration. Kolkhozes with high economic indexes pay higher than the average level of remuneration of labor on sovkhozes.