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Guangdong pushes for fiscal transparency
By Li Wenfang (China Daily)
Updated: 2004-04-15 00:01
Guangdong Province is taking the lead not only in economic development, but
also in constructing a sound financial system.
Delegates to this year's session of the Guangdong
People's Congress had a tough task dealing with this year's government budget
proposal, a book swelling to 540 pages.
A delegate to Guangdong People's Congress sits
beside a computer monitor, which shows online the budgetary details of
province-level departments. [newsphoto/file] |
A total of 114 government departments at provincial level -- 12 more than
last year -- submitted the budgets that make up the book.
During the February session officials from the province's Finance Department
also had a hard time answering delegates' questions about what they considered
unjustifiably-funded items.
Delegates found, for example, that four kindergartens affiliated with
government agencies, which were reserved for children of government employees,
were allocated more than 20 million yuan (US$2.41 million). They demanded an
explanation as to why taxpayers' money should be used to raise civil servants'
children as well.
Delegates from Guangdong to this year's session of the 10th National People's
Congress last month became newsmakers again in proposing allowing general public
access to all but sensitive content of the Ministry of Finance's budget
proposal.
"I think the government should let us know, should let the public know, how
taxpayers' money is spent, where the money goes and what amounts are spent,''
said Li Bingji, chairman of a privately-held enterprise in Guangdong, who led
the team making the proposal.
Li's team pointed out the transparency and efficiency of the government's
budget, which emphasizes the issue of "(government's) finance under sunshine''
in China. Greater transparency helps fend off corruption, they said.
The Chinese Government said in 1999 it was committed to building a public
finance system and taking subsequent measures to implement the policy.
South China's Guangdong Province has made significant progress towards the
goal.
"I would not say we were the earliest to start but we have made big
strides,'' said Huang Ping, the director of the Budget Supervision Office of the
Financial and Economic Committee of the Provincial People's Congress.
The achievements of Guangdong in this area are attributable to its robust
economic development and increasing awareness of the government's role as well
as the experience and knowledge of the people's delegates, Wang Chaocai, deputy
director of the Research Institute for Fiscal Science under the Ministry of
Finance, told China Daily.
Guangdong, from 2001 onwards, has been pushing a detailed budget proposal as
an important part of a public finance system. It is intended to present the
proposal to the People's Congress. Seven provincial departments also presented
budget proposals to the congress in that year.
"Just as you cannot give a document you have no idea of to your superior for
approval, you should not bring a budget proposal without any details to the
People's Congress. That's why a detailed proposal is necessary,'' Huang said.
Budget proposals for the 114 departments -- involving a total of 22.5 billion
yuan (US$2.71 billion) -- were examined by people's delegates this year.
For example, an item involving expenditure of only 43,000 yuan (US$5,181)
appears in this year's provincial proposal. It would not previously have been
listed because it is a small amount. And previous proposals covered only a few
pages that listed expenditures in only general terms.
Cities at the prefectural level in the province have also included department
budgets in the proposal to their respective local people's congresses, said Xie
Xianxing, a professor with the Finance and Tax Department of the Sun Yat-sen
University in Guangzhou, capital of Guangdong.
"More details mean transparency. That in turn indicates the willingness of
the government to be supervised by the people's congress,'' Huang said.
A relatively developed province, Guangdong recorded government budgetary
revenue of 131.33 billion yuan (US$15.82 billion) and budgetary expenditure of
169.49 billion yuan (US$20.42 billion) last year, increases of 14.8 per cent and
11.5 per cent year-on-year respectively.
Government's budgetary revenues and expenditures at the provincial level
stood at 41.17 billion yuan (US$4.96 billion) and 41.12 billion yuan (US$4.95
billion) respectively last year.
Planned budgetary revenues and expenditures at the provincial level this year
are 42.38 billion yuan (US$5.11 billion) and 42.32 billion yuan (US$5.1 billion)
respectively.
To appraise the efficiency of the budget, Shenzhen is auditing four selected
projects funded by the government last year.
Problems detected by auditing include the lack of a feasibility study before
commencing a a project, a lack of bidding process, inadequate management,, poor
accounting,, inefficiency and legal violations.
The Planning and Budget Committee of Shenzhen People's Congress also
presented suggestions for improvement in project management.
The Standing Committee of the Guangdong People's Congress plans to link with
the computer system of the Provincial Finance Department this year so it can
obtain information on revenues and expenditures to enable better supervision.
The Provincial Finance Department plans to set up a specialized division for
budget efficiency assessment, a plan reportedly likely to be approved this year.
It will select government-funded projects as targets for assessment.
The government is presently working on standards for assessment.
Government at lower levels has also been required to set up budget efficiency
assessment systems.
Guangdong People's Congress will also push for more detailed budget proposals
by government departments.
However, Guangdong, like other provinces, still has a long way to go in
building a public finance system, Xie said.
Off-budget revenues and expenditures, which total considerable amounts,
should be included in the budget, he said.
Details of the budget proposal, excluding sensitive ones, should be
accessible to the general public, he said.
Some delegates to this year's Guangdong People's Congress session actually
frowned over the secrecy warning on the cover of the proposal.
Delegates also complained about a lack of time to go through the details in
the proposal before they voted on it. They had only two days to finish the book,
which also requires financial and accounting know-how to understand.
Some experts suggested the establishment of an experts'
consultation committee for assessing the budget proposal.
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