Colloquium 1996 Panel III : Armed Forces and Defence Industry in Transition Economies: The Human Dimension

Influence on Human Resources of the Republic of Belarus by Defence Conversion Vyacheslav A.Yantsev Chairman, Ministry of Defence Scientific and Technical Committee, Minsk Summary Defence conversion, which has been started in the Republic of Belarus, is at the beginning of a long and difficult journey. Conversion has become one of the most important political and economic problems in Belarus. It is vitally important as it has a key meaning for normalization of the economy and its integration into the world economy. The success of the conversion programmes will depend upon the efforts of enterprises, the effectiveness of their work, the proper choice of conversion direction and the determination of development prospects. Providing foreign assistance is an important condition - technical and financial help, technologies transfer, and investments for conversion projects. Solving the social problems arising from the conversion process should be at the centre of state attention. While the financial burden is one of the main consequences of conversion, the main social problem is, certainly, the influence on human resources, manpower and employment. First of all there are the following problems: minimizing social and political instability resulting from reducing troop strength and employment in defence industry, abolition of the manpower surplus, creation of additional working places, and working out the mechanisms for preventing unemployment growth. Resettlement is the most important problem for a majority of countries of Central and Eastern Europe, especially in the period of reducing personnel and defence conversion. This paper shows how this problem is being solved in the Republic of Belarus.

Prerequisites for Conducting Conversion in Belarus In the former Soviet Union a large group of troops (about 200,000) equipped with modern armament, was deployed, on the territory of the Republic of Belarus. The concentration of military units in the republic was the highest on the European continent. The ratio of military to civilians was 1 to 43. This group provided the basis for forming the national Armed Forces in 1992. However it became apparent from the very beginning that a republic with a population of 10 million people, does not need such large Armed Forces. Expenditures for their equipment and maintenance appeared to be exorbitant for our budget. On the other hand, by the beginning of the 1990s a significant share of industry in the republic was involved in the Soviet Union military and industrial complex. Priority was given to the development and production of computing machinery, optical devices, systems and means of communication, automatisation of control systems, electronic components and other elements of armament and material. Enterprises and organisations of the republic managed to reach a relatively high level in these directions. An important peculiarity of the Belarussian defence complex is the availability of a large number of manufacturers, which do not have functional completeness on the level of the armament systems. As a rule, separate parts of these systems were produced, and the assembly was completed beyond the republican boundaries. Excessive militarisation of the economy diverted the best resources, which resulted in unfavourable economic and social consequences. Belarus defence industry and science, which had been formed for dozens of years in the interests of the "Great Power", were not oriented on the structure and dynamics of the internal market of the republic. According to some estimates, about 0,5 million people were involved in the defence complex. As in the other republics of the former Soviet Union, the existence of towns and settlements where the majority of the able-bodied population was employed at defence complex enterprises became a demographic peculiarity of Belarus. Hence, Belarus at the stage of the formation of its statehood, encountered a whole complex of economic and social problems which needed to be solved without delay. Large resources of the defence sector of Industry and the Armed Forces needed to be reoriented towards solving economic, social and ecological problems of the country, and hence to contribute to its integration into the world economy. Main Directions of Conversion in Belarus The process of conversion conducted in Belarus includes two main interconnected components: conversion of Defence Industry and conversion of parts of the Ministry of Defence. According to the concept worked out in the republic, defence conversion is following the direction of partial or full reorientation of the excess industrial facilities, scientific and technical potential and resources of defence enterprises, from military to civilian needs. Priority state programmes for social and economic development, taking into consideration the scientific and technical and industrial potential specialisation, technical equipment of enterprises and personnel qualifications, have been determined. The most important of these have been aimed at the creation of a basis for modern electronic elements and computers, automated data processing systems in various spheres, international communication networks, and a broad variety of optical products and medical devices. Defence conversion of the elements of the Ministry of Defence is aimed at gaining maximum effect from reorientation of material, technical and human resources of the Armed Forces for their use in the economic sphere. The last five years have brought radical changes to the economic structure and the defence potential of Belarus. During this period of time more than half of the chief industrial enterprises and scientific organisations, developing and producing defence products, have been converted. In 1995 the share of defence orders, in comparison with 1991, decreased more than five times. At the present time only 5-10% of the scientific and industrial potential of the defence complex of Belarus is used. The character of conversion processes is vividly traced in the dynamics of changes of the structure of industries which are traditional for Belarus - electronic and optical and mechanical branches. For instance, the share of defence products output in the electronic industry decreased from 70% in 1991 to approximately 3% in 1994, and in the optical branch it decreased from 65% to 5% for the same period of time. As a result of conversion there is a substantial withdrawal of qualified specialists from defence enterprises. On the whole, the numbers of personnel at defence enterprises of the republic have been reduced by 2,5 times for four years. This trend is typical for the Armed Forces as well. Since the first days of their creation, a course was taken at reforms. According to the Helsinki Agreement of 1992 the strength of the Armed Forces of Belarus should not exceed 100,000 military personnel. By the beginning of this year we have 85,000 military personnel and the process of reductions will be continued. The financial burden is one main consequence of conversion, but the main social problem is the influence on human resources, manpower and employment. Included are the following problems: minimizing social and political instability, as reduction of military forces and employment in defence industry takes place, and the manpower surplus is reduced through creation of additional work places, and developing mechanisms for preventing unemployment increases. Resettlement of redundant personnel is the most important problem for a majority of countries of Central and Eastern Europe, as labour forces are reduced during defence conversion. Human Dimension of Conversion in Belarus The problem of employment of specialists, earlier employed at defence enterprises, is being solved in the republic in two ways. The first one is not linked with large financial expenditures on resettlement. In this case the workers of the converted enterprises have the following opportunities: remain at the enterprise and switch to production of civilian products which are technologically similar to defence products; or go to the civilian sector of the economy in accordance with one's qualifications. For Belarus this is the most typical situation because the major activities of the defence industry (such as electronics, optics, transportation equipment, information technologies and others) are connected with the so-called "dual-use technologies". As analysis shows, with the decrease of orders at defence enterprises, mostly young specialists, who had worked no more than five years, and people, near retirement, were made redundant. The majority of young specialists either went to the corresponding civilian sector according to their profession or remained at the enterprise and continued their work in the newly established small structures. Of course, a certain percentage of specialists changed profession and went to commercial structures. The second way includes drawing on substantial budgetary allocations for resettlement of those who cannot be employed, either in the military or the civilian sphere, in accordance with their qualifications. This situation is typical, as a rule, for low-skilled specialists or bad workers (the so-called "staff lumber"). The percentage of such employees is not very high. Usually they do not want to resettle, but prefer to go to commercial structures in secondary positions. Though we do not have a state programme for workers of the former defence enterprises resettlement scheme, they do have opportunities for receiving retraining. A whole network of resettlement courses (both commercial and state) at the educational institutions of the republic exists. However, while there are reforms at all the enterprises connected with the transition to the market economy, it is more and more difficult to get a job even after resettlement. There exists one more problem of a social character. Alongside the complete halt or sharp reduction of financing defence orders, the financing of housing programmes for defence enterprise workers was also stopped. This especially influences small research institutes and construction organisations, because they gain little profit under the process of conversion and therefore they cannot finance building houses. A more difficult, and still unsolved, problem is connected with the loss of interest of workers, decrease of their effectiveness, and manifestation of stereotyped minds. The reasons for this are - the unreadiness of workers for new conditions of work, more rigid industrial relations, and low level of payments. Opposing views of the two parties are well-known: "To get a good salary one needs to work well", the administration says. "To work well one needs to be paid well", a worker says. These axioms are both true and characterize the majority of converted collectives. The solution is in conscious rapprochement of the positions of the two sides. The Problem of Retired Officers of the Armed Forces During the period of reforms since 1992 about 18,000 officers have been retired from the Armed Forces. Of these 4,000 are under age 45, i.e. quite able-bodied men. The problem of their employment is especially acute in regions remote from the centre. To defend socially the retired officers and members of their families, in July 1992 the Government decided to establish a Resettlement Centre. The Centre received the status of a skills improvement institution and was given the right to issue diplomas. In the first stage, with the financial help of Germany and the USA, a training program was developed for training in six professions of the market economy: management, marketing, commercial activity in the goods and services market, accounting, analysis and audit. Five computer class rooms (about 150 computers), two educational firms, and a classroom for computer service specialists training have been established. In 1994 two branches of the Centre were opened in Lida and Brest. The educational basis for two new professions has been organized: autoservice manager and wood-processing manager. At present full establishment of the Resettlement Centre has been finished. The period of training is six months. There have already been five graduations, with a total of 1900 graduates, 70% of whom have been employed in accordance with the training received at the Centre. These are mostly young officers who were made redundant and did not qualify for a pension. The Centre, together with the State Labour and Social Defence Committee, Republican Employment, provides assistance in employment for retired military and members of their families. Alongside this a special data bank, with information about the situation on the labour market, is used. About 12,000 military and members of their families have been employed. Nowadays about 20,000 officers serve in the Armed Forces of Belarus. The average age of officers is 32. By 1996 the general shortfall of officers in the Armed Forces was more than 2,000. Taking into consideration the Armed Forces reform programme, we do not plan a further big redundancy of officers in the next 3-4 years. Another problem has arisen from the several big military maintenance plants, airbases, and hundreds of elements of military infrastructure, which were established in Belarus for the needs of the former Soviet Union multimillion-man army. The Belarussian Army does not need facilities of such scale, and we are not able to provide orders for military plants, or to maintain and use airdromes, military settlements etc. The most reasonable solution is some form of conversion. The plants might be partly reorientated for the maintenance of similar civilian machinery, the large airbases converted to transport and terminal complexes and check-points for "East-West" traffic, former military bases might be turned into zones of medium and small business, or recreation and tourism zones might also may be organized there. This means also creation of new work places for the former military and members of their families in the districts where these former military facilities are situated. For example, only in the Vitebsk region about 3,000 former military and members of their families, who need employment, live. Of these, 64% are under age 45. Opinion polls conducted among the inhabitants of the settlements have shown one peculiarity - claims of unemployment are not so high. Some 64-75% would like to work in accordance with their profession, and 20-38% are ready to do any work. For realisation of any conversion project investments are needed. Therefore, we call on everybody for cooperation in this interesting and important matter. For realisation of any conversion project investments are needed. Therefore, we call on everybody for cooperation in this interesting and important matter.