The Polish government announced price increases of up to 11 percent on food and other staple goods today as communist leader Wojciech Jaruzelski warned that economic problems had reached "an acute form."
The price increases, which will take effect on Monday, were revealed on television tonight in a blitz of official publicity apparently calculated to soften public reaction. They covered food staples such as bread, milk, cooking oil, flour, cream, cheese and sugar as well as alcoholic beverages.
Price increases in rationed meat, often the trigger for political unrest in Poland, were delayed until August, and authorities said they would be raised by less than 8 percent. Increases also were announced for later in the year covering coal, electricity, gas and rail transport.
Rumors of the increases caused a rush on stores and long lines in Warsaw and other cities yesterday and today. Official sources said that no open protests against the measures were expected but that the government was prepared to handle disturbances.
Gen. Jaruzelski, setting the stage for tonight's announcement, said in a major speech to the party Central Committee yesterday that the growth of salaries had exceeded "by several times" the pace of labor productivity and that "the first months of this year have seen no improvement."
While acknowledging that the impact of increases on low-income families must be studied, Jaruzelski said that "keeping price rises at bay with administrative methods will help practically nothing."
A similar announcement of price increases by Jaruzelski's government a year ago provoked isolated stoppages in factories by workers seeking compensatory raises and was strongly protested by both the banned Solidarity trade union and officially sponsored unions. The government eventually negotiated with the official unions to stagger planned meat price increases.
Asked why the new price increases had not been the subject of similar consultations, government officials argued tonight that a decrease in the rationing of staples made such public soundings impractical. They added that the prices no longer could be negotiated because they were essential to economic stability.
The increases, which fell mostly in the range of 7.5 to 8.5 percent, were in line with an annual economic plan that also calls for strong controls on wages to prevent market imbalances and shortages. Jaruzelski's speech underlined concerns that shortfalls in planned production last year combined with high wage increases could plunge the economy into a new crisis unless the trends are reversed.
With workers pressing hard for raises, wages rose by well above 20 percent last year, or more than a third more than planned, while the growth of production slowed from 5.8 percent in 1984 to about 3.5 percent. Exports also dropped, and at the end of last year Poland could not meet payments on its $29 billion foreign debt, forcing the negotiation of new terms with western banks and governments.
Despite growth during the past three years, production still stands below the level of 1978, and living standards remain about 20 percent lower than in the late 1970s, according to official statistics. Durable goods are still in short supply, and meat, gasoline and chocolate remain rationed. Sugar rationing was lifted last year, but today's measures raised its price by 11 percent.
In a special television program on the price increases tonight, senior officials of the wage and finance ministries said that a failure to raise prices could bring back the severe food shortages Poland experienced in the early 1980s. They added that prices also had to be raised in order to make increased agricultural production possible.