A new economic engine for China

Updated: 2013-03-28 07:42

By Zhao Yinan (China Daily)

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The government's latest anti-graft campaign is notable for its determination to delegate and limit administrative power, instead of cracking down on corruption case by case, said Liu Shanying, a political researcher at the Chinese Academy of Social Sciences.

The six measures that Li Keqiang put forward to help build a clean government - the delegation of, and restrictions on, power; tighter budgetary supervision; official transparency; diligence and frugality; and the rule of law - are all intended to either limit or cede some administrative power to lower levels of government and the public, according to Liu. "By restricting the use of government power, the leadership is attempting to reduce the chances of possible derelictions of duty and weed out graft."

Li's pledge is an upgrade of the existing anti-graft policy, he added, saying that although there have been repeated calls for a reduction of unnecessary government intervention in the market, it is the first time the top leadership has officially used the phrase "institutional dividend", referring to stimulation of the economy through a reduction of administrative involvement.

At his first media conference as premier on March 17, Li promised to streamline government functions and pledged to slash the 1,700 items that require administrative approval by "at least one-third" in the coming five years, saying the system could lead to corruption.

Liu said the reforms, if successfully carried out, will become a new economic engine as China's traditional demographic advantages conferred by a large, mobile workforce, vanish gradually, a point reinforced by data from the National Bureau of Statistics showing that the working-age population declined by 3.45 million in 2012.

"But curbing government power, a self-imposed reform will be painful because it entails the sacrifice of vested interests. Supervision is needed to ensure that central government policy is being fully implemented at local levels," warned Liu.

In addition to greater delegation of power, Premier Li also emphasized the appropriate use of power at the meeting on Tuesday.

Li urged all levels of government to open their accounts to public scrutiny, along with details of government-funded overseas trips, vehicles and receptions. As of this year, governments at or above prefecture level should disclose their spending on government-funded receptions, he said, adding that the information should be presented in a way everyone can understand.

Ma Jun, a professor of public governance at Sun Yat-sen University in Guangzhou, Guangdong province, said opening the government's accounts book is the basis of building a clean government, because a lack of transparency can be a breeding ground for irresponsible activity.

"It is difficult for the public to keep an eye on everything the government does, but fiscal transparency could be one of the approaches to allow the people to oversee government activities by watching its wallet," he said.

Last year was the third time central government departments had been required to reveal their revenues and spending after the measure was introduced in 2008.

"Li's pledge is a big step forward, because at present this sort of disclosure is mostly carried out at central government level, while only a few local governments have opted to open their books to the public."

Bringing government revenues under public scrutiny will prevent the arbitrary use of taxpayers' money, he said. "We can see some progress, but there is a lot more room for improvement."

Instead of just making official expenditure easy to understand, it would be better if the governments explained the reasons behind significant spending changes. Meanwhile, the highest levels of government should be responsible for verifying that the figures released are accurate, he said.

The local government of Jiaozuo, a medium-sized city in Central China's Henan province, is one of the few that has taken the initiative to open its accounts book, a move its peers have yet to emulate.

Lu Guoxian, Party chief of Jiaozuo, earned a net salary of 5,418 yuan ($872) this month, according to the website of the city's finance bureau, where the salary of every government employee is published every month.

Ma, who visited Jiaozuo to observe the financial reforms, said the trial has no legal backup, despite its groundbreaking nature. He expressed concerns that the national campaign to make spending on government-funded receptions more transparent will suffer the same fate.

"If the campaign is only pushed forward by the leadership's vision and not specific legislation, it will lack any real legal clout and will be a temporary phenomenon."