Supreme Soviet of the National Economy, Superior Soviet of the People's Economy, (Высший совет народного хозяйства, ВСНХ, ''Vysshiy sovet narodnogo khozyaystva'', VSNKh) was the superior state institution for management of the

economy An economy is an area of the Production (economics), production, Distribution (economics), distribution and trade, as well as Consumption (economics), consumption of Goods (economics), goods and Service (economics), services. In general, it is ...

of the

RSFSR The Russian Soviet Federative Socialist Republic (Russian SFSR or RSFSR), previously known as the Russian Socialist Federative Soviet Republic and the Russian Soviet Republic, and unofficially as Soviet Russia,Declaration of Rights of the labo ...

and later of the

Soviet Union The Union of Soviet Socialist Republics. (USSR), commonly known as the Soviet Union, was a List of former transcontinental countries#Since 1700, transcontinental country that spanned much of Eurasia from 1922 until Dissolution of the Soviet ...

. There were two institutions with this name, at different times, 1917–1932 and 1963–1965.

1917–1932

The VSNKh of the first period was the supreme organ of the management of the economy, mainly of the industry.

Foundation

The VSNKh was launched on December 5, 1917, through a

decree A decree is a law, legal proclamation, usually issued by a head of state, judge, monarch, royal figure, or other relevant Authority, authorities, according to certain procedures. These procedures are usually defined by the constitution, Legislativ ...

of the

Council of People's Commissars The Council of People's Commissars (CPC) (), commonly known as the ''Sovnarkom'' (), were the highest executive (government), executive authorities of the Russian Soviet Federative Socialist Republic (RSFSR), the Soviet Union (USSR), and the Sovi ...

(Sovnarkom) and All-Russian Central Executive Committee of Soviets of the Russian Socialist Federative Soviet Republic.Alec Nove, ''An Economic History of the USSR.'' New Edition. London: Penguin Books, 1989; pg. 42. Its stated purpose was to "plan for the organization of the economic life of the country and the financial resources of the government". It was subordinated to the Sovnarkom. The recently established All-Russian Council for Workers' Control was dissolved into the new organisation. It had rights of

confiscation Confiscation (from the Latin ''confiscatio'' "to consign to the ''fiscus'', i.e. transfer to the treasury") is a legal form of search and seizure, seizure by a government or other public authority. The word is also used, popularly, of Tampering w ...

and

expropriation Nationalization (nationalisation in British English) is the process of transforming privately owned assets into public assets by bringing them under the public ownership of a national government or state. Nationalization contrasts with p ...

. The first chairman was Valerian Osinsky and with Bukharin, Georgy Oppokov (Lomov), Milyutin, Sokolnikov, and Vasili Schmidt also appointed to the council.

Reorganisation

After the creation of the

in 1923 it was transformed into the joint all-Union and republican

People's Commissariat A People's Commissariat (; Narkomat) was a structure in the Soviet state (in the Russian Soviet Federative Socialist Republic, in other union and autonomous republics, in the Soviet Union) from 1917–1946 which functioned as the central executive ...

. In 1932, it was reorganized into three

s: of

heavy industry Heavy industry is an industry that involves one or more characteristics such as large and heavy products; large and heavy equipment and facilities (such as heavy equipment, large machine tools, huge buildings and large-scale infrastructure); o ...

light industry Light industry are Industry (economics), industries that usually are less Capital intensity, capital-intensive than heavy industry, heavy industries and are more consumer-oriented than business-oriented, as they typically produce smaller consum ...

and

forestry Forestry is the science and craft of creating, managing, planting, using, conserving and repairing forests and woodlands for associated resources for human and Natural environment, environmental benefits. Forestry is practiced in plantations and ...

. In each of the union republics of the Soviet Union, subordinate organisations existed. These were referred to as ''ВСНХ'' followed by their union republic acronym. (for example ''ВСНХ БССР'' (VSNKh BSSR) for the Belarusian SSR). The all-union council could be referred to as ''ВСНХ СССР'' (VSNKh SSSR). The republican VSNKhs had control over small scale, minor industries which used local materials and supplied local markets and which were referred to as "enterprises of republican subordination". Large scale industrial enterprises ("enterprises of union subordination") were controlled by one of the industrial sector departments of the all-union VSNKh.

Organisational structure

Within the VSNKh, departments were split into two types.

Functional sector departments

Departments within the functional sector dealt with decisions relating to

finance Finance refers to monetary resources and to the study and Academic discipline, discipline of money, currency, assets and Liability (financial accounting), liabilities. As a subject of study, is a field of Business administration, Business Admin ...

planning Planning is the process of thinking regarding the activities required to achieve a desired goal. Planning is based on foresight, the fundamental capacity for mental time travel. Some researchers regard the evolution of forethought - the cap ...

, economic policy, and

research and development Research and development (R&D or R+D), known in some countries as OKB, experiment and design, is the set of innovative activities undertaken by corporations or governments in developing new services or products. R&D constitutes the first stage ...

Industrial sector departments

Departments of this type were created by decree in 1926 and consisted of "chief departments", known as ''glavki'' (''glavnye upravlenija''). Heads of all the departments in this sector formed the council of the all-union ''VSNKh'' together with representatives from the union republics.

Heads of the VSNKh

* Valerian Osinsky (1917–1918) *

Alexei Rykov Alexei Ivanovich Rykov (25 February 188115 March 1938) was a Russian Bolshevik revolutionary and a Soviet politician and statesman, most prominent as premier of Russia and the Premier of the Soviet Union, Soviet Union from 1924 to 1929 and 1924 t ...

(1918–1920) * Felix Dzerzhinsky (1924–1926) * Valerian Kuibyshev (1926–1930) *

Sergo Ordzhonikidze Sergo Konstantinovich Ordzhonikidze, ; (born Grigol Konstantines dze Orjonikidze; 18 February 1937) was an Old Bolshevik and a Soviet statesman. Born and raised in Georgia, in the Russian Empire, Ordzhonikidze joined the Bolsheviks at an e ...

(1930–1932)

1963–1965

Vesenkha was reestablished by

Nikita Khrushchev Nikita Sergeyevich Khrushchev (– 11 September 1971) was the General Secretary of the Communist Party of the Soviet Union, First Secretary of the Communist Party of the Soviet Union from 1953 to 1964 and the Premier of the Soviet Union, Chai ...

when he introduced decentralization of the management of industry by means of

sovnarkhoz Sovnarkhoz (, ''sovet narodnogo khozyaystva'', "Council of National Economy"), usually translated as Regional Economic Soviet, was an organization of the Soviet Union The Union of Soviet Socialist Republics. (USSR), commonly known as the Sov ...

es. It was subordinated to the Council of Ministers of the USSR and managed industry and construction. Sovnarkhozes were introduced by

in July 1957 in an attempt to combat the centralization and departmentalism of ministries. The

USSR The Union of Soviet Socialist Republics. (USSR), commonly known as the Soviet Union, was a List of former transcontinental countries#Since 1700, transcontinental country that spanned much of Eurasia from 1922 until Dissolution of the Soviet ...

was initially divided into 105 economic regions, with sovharknozes being operational and planning management. Simultaneously, a large number of ministries were shut down.