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Romania Planning
Beginning in 1951, following the Soviet economic model,
Romania
adopted annual and five-year economic planning. As in the
Soviet
system, the principle of democratic centralism applied
(see Organizational Structure
, ch. 4). Thus, the economic plans
compiled
by the central planning organs became the law of the land,
and
compliance was mandatory.
In theory, the Unitary National Socioeconomic Plan, as
economic
plans were officially called after 1973, was based on
information
on current plan fulfillment, requests for resource
allocations, and
recommendations for investments that originated on the
lowest
echelons and rose through the bureaucracy to the central
planners.
Such a system involved a certain amount of give and take
as
enterprises and centrale "negotiated" with the
ministries
for favorable production targets and resource allocations.
In turn
the ministries lobbied for their respective sectors to
gain
priority consideration in the state budget. But during the
1980s,
input from lower echelons in the planning process received
less
consideration. In part, this development was due to the
unreliability of information reported by the managerial
cadres,
from the local level up to the heads of the economic
ministries
themselves. Plan fulfillment data were supposed to serve
as the
basis on which future economic plans were compiled, but in
the
1980s data became skewed when salary reforms--the
so-called global
accord--began linking managers' incomes to the performance
of the
economic units under their supervision. In 1986 this
remuneration
system encompassed nearly 11,000 managers and bureaucrats,
even
including the heads of ministries and the deputy prime
ministers.
In order to maintain their incomes, officials simply
falsified
performance reports. As a result, aggregate production
figures were
grossly inflated, and annual and five-year plan targets
based on
these figures became increasingly unrealistic.
Besides distorting production reports, managers
resorted to
other income-protecting measures that impeded the flow of
accurate
information to the central planners. Because wages and
salaries
were tied to plan fulfillment and severe penalties were
levied for
shortfalls--even when caused by uncontrollable factors
such as
power shortages, drought, and the failure of contractors
to deliver
materials and parts--it was in the interests of the
enterprises,
centrale, and ministries to conceal resources at
their
disposal and to request more inputs than they really
needed.
Managers concealed surplus operating reserves to ensure
production
in the event of unforeseen bottlenecks. This practice made
accurate
inventories impossible, resulting in inefficient use of
resources.
Data as of July 1989
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