Chile: the balanced view : a recopilation of articles about the Allende years and after

B) Measures for reeonstruction The new Government's measures permitted a rechannelling 01 the economy withín a relatively normal Iramework, thus laying a base lor the efforts 01 national reconstruction the Nation ís determined on. 1974's economic program has been planned so as to delinitely consolidate these bases, eliminating any existing distortions, and making strong endeavours towards saving, pfOductíon and stabilization. 1. Wage and price policy The Government is determined to continue with its wage policy that guarantees each lamily's rights to a market consumption compatible with its needs. Special importance is given tothe situation olthe lower brackets. This is whythis polícy is not based solely on the traditíonal tool 01 readjustments 01 wages and salaries, but it also includes a good increase in lamily allowances; the setting up 01 an effective program 01 child nutrition, the wide– spread use of the experience gained in the direct sale of supplies to settlements, etc., and the granting 01 special monetary compensatíon each time the increase 01 prices delerlorates the buying power 01 the needy. In respect to lamily allowances, the putting into practice 01 the Fondo Unico de Asignación Familiar (Sole Fund 01 Famíly Allowances) must be mentioned, as it was an initiative which joined into one thé different systems 01 lamily allowances that had been in existence, and which granted an equal allowance lor everybody which right now is set at EO 1.800 per dependen!. In September 1973 a labourer received EO 250 per dependent; in October this amount increased to EO 900, and in January 01 this year il rose to EO 1.800 per dependen!. As to the policy 01 wages and salaries, it was designed lO e'1sure workers a level 01 money received that would be equivalent to the average realsalary they got during 1973. It is worth noling that this real salary level is 50% more than the one the workers got during the third "quarter 01 1973, the period which preceded the change 01 Government, and, in its turn,30% more than the average real salary 01 the last quarter 011973. The readjustment 01 remunerations granted at the beginning 01 this year Iluctuated betweeR 50 % and 60% 01 the I.ast quarter's average remuneration, which er¡su'res all workers, Irom the start, a real salary level compatible with the planned goal. Depending on the behaviour 01 the level 01 prices, the amount and moment lor future readjustments wi 11 be decided later. The forementioned wages policy is complemented by a price system tending to achieve an elficient distribution of resources. It is the Government's aim to continue with this realistic price policy begun in last October, but improving its application and the existinQ mechanisms 01 control. To this end, legal texts, delining and punishing econof'1ic crimes, and impeding the existence 01 monopolic structures, have been published. Fur– thermore, all the artilicial barriers which prevent competition are being elíminated, as, for example, no new installation permits in certain industries are being granted, and It has also been planned to really use loreign commerce lor this purpose, as long as the situation of the balance 01 payments permits, and, lor this, a statute 01 a policy on custom tariffs has been made. The mechanisms lorlixing prices are being improved, so that the prices 01 controlled products are properly established. As jt was announced in last October, the prices 01 some products which were still subsidized, have recently been put up to their real level, thus ending with all the bonuses through prices" " The Government isconvinced that this policy will bring clear benelits to the country, not only in relation to a proper distribution 01 resources, but to fiscal linances. For example, it will mean a revitalization 01 the agricultural production, which we trust will allow lis to" reallocate an important amount 01 our 1975 import commitments. The elimination 01 subsidies pointed out, and the increase in international prices, particulatly 01 oil, lood and Ireights, has lorced during the lirst quarter 01 this year an 207