Home pageAdvanced searchIndexe-mailAdd to favorites
Books by Grigory Yavlinsky
Economics and Politics in Russia
The Center for Economic and Political Research (EPIcenter)
Nizhni Novgorod-Moscow, 1992

4.1 Entrepreneurship and Property

4.1.7. Generalisation of the experience of land reform

[previous] [CONTENTS] [next]

The great progress of land reform in Nizhni Novgorod oblast is related to the allocation of plots of land for horticulture and market gardening, and individual acquisitions of such plots. The allocation of land in suburban areas is a most complicated problem, connected with the interests of numerous groups of individuals, production collectives and local authorities. Federal Government solutions adopted in 1991 and at the beginnning of 1992 involving land relations in Russia give no clear-cut legal mechanism for the confiscation and allocation of land, and are contradictory and intended for further legislative work. By the end of 1991, the regional authorities had received up to 125,000 applications for the allocation of land plots for horticulture and market gardens. The

administration was the initiator and developer of quite an effective mechanism (as shown by expe rience) for transferring land ownership to private individuals.

This mechanism includes three key aspects: the allocation of land, appraisal of plots of land, and the sale of those plots.

At the first stage, the standards for allocation of plots of land were communicated to the heads of the administrations of suburban regions. Payment for the plots allocated was stipulated in accordance with the usual procedure (on average, approximately 17,000 roubles per hectare). Direct administrative pressure on the leadership of the regions and control by the governor assisted in the allocation of about 8,000 hectares out of the 9.5 requested.

At the same time, research conducted by the Committee for Land Reform and Land Resources indicated that the land allocated was within a radius of 70-100 kilometres from the city, and that a significant portion was made up of graveyards, swamps, and other land unsuitable for agricultural use.

Consequently the administration drafted and proposed a new system for appraisal of plots of land, proceeding from the criteria of their proximity to the city and transport lines. It was proposed that the administration of the suburban regions allocate additional plots of land 20-25 kilometres from the cities of Nizhni Novgorod and Dzerzhinsk, but at a price of 80,000 to 150,000 roubles per hectare, and moreover, with virtually immediate (two-stage) payment for the plots. By a decision of the regional council, 191 million roubles were allocated from the regional budget for this purpose. This had an immediate effect, improving the financial standing of the regional authorities. For example, the value of plots of land in Dalnekonstantinovsk Region alone purchased by the oblast was 80 million roubles, as compared with an annual regional budget of approximately 40 million roubles.

This considerably speeded up the regions' allocation of the plots of land requested, assisted the regional administrations' "search" for land reserves, and their redistribution among the region's farmers. The third step consisted of the sale to individuals of the these plots of land. To simplify the submission, collection, and processing of individuals' applications for plots of land, a single day was chosen for the collection of the applications, which had been distributed in district offices, which resembled their electoral counterparts. The current voters' lists were used to register applications. Prior to the collection of the applications, the population was informed of the plots of land allocated, their location and prices. Tenders were organised in the districts. Consequently family members, relatives, or acquaintances, who had reached the age of majority, were included on land applications.

In this system, the number of applications rapidly dropped to 23,000, which set the actual demand. In one of the more prestigious regions, which had witnessed eight applications for a particular plot of land, the successful applicants were five legal adults, including one from a special category of individuals (the disabled, veterans, etc.) granted privileges.

After analysis and verification, approximately 17,000 correctly submitted applications remained. All of them were formally accepted.

The payment of the cost of the plots of land was set in instalments over 10 years for individuals with lower incomes per family member, and up to 3 years for families with incomes above 3,000 roubles per month per person. Given the official indexing of minimum wages, the balance of the payment is subject to similar indexing. The monetary funds were transferred to special budget accounts of the administrative regions, where the district offices were located. Prior to full payment of the cost of the plot of land and the individuals' receipt of the state deed of land tenure, the heads of the regional administrations issue them temporary certificates for the right to use the plots.

When introducing this procedure for land distribution, problems arose, which were on the whole related to the ineffectiveness of the system of committees for land reform. Even after examination, much of the land allocated turned out to be located in swampy locations, or bereft of any piping or electric transmission lines, etc. Consequently, only 10,000 out of the 17,000 applications which formally passed through the competition process for the land which had already been purchased by the oblast. This led to a wave of investigations, complaints, etc. The second stage of land privatisation, for horticulture, market gardens, and construction of individual dwellings, is now being prepared in the oblast.


[previous] [CONTENTS] [next]