Transparent Spending

By JING XIAOLEI

Transparent Spending

By JING XIAOLEI

People obtain wider access to details of government expenditure

How much does it cost to have the annual session of the National Committee of the Chinese People’s Political Consultative Conference(CPPCC), the top political advisory body?For the first time, the answer was given to the public: About 59 million yuan ($9 million) in 2010.

The unprecedented expenditure disclosure came after a journalist raised a question about spending with Zhao Qizheng, spokesman of this year’s session of the CPPCC National Committee, at a press conference on March 2.

Though Zhao couldn’t give an immediate answer, he said, “Please allow me to ask my colleagues and send you an e-mail or text message afterward.” The journalist got the answer from the News Of fi ce of the CPPCC National Committee.

It was the first time such spending figures have been released to the public.The 59-million-yuan figure is mainly money spent on the 2,237 CPPCC National Committee members, workers at the session and hotel stays during the 10-day event, said the news of fi ce.

“It’s news to me that the cost was made public. But, it’s progress to make it transparent. The public has the right to know how much money was spent and what it was spent on,” said Zhao Shuyue, a CPPCC National Committee member. He said it’s an effective way to prove the grand meeting of political advisors isn’t wasting money and that it welcomes public scrutiny.

Since the CPPCC National Committee has taken the lead in disclosing accounts of its spending, lawmakers are also calling for the government’s expenditure to be disclosed in detail as the government vows to make its fi nancial information more accessible to the public this year.

“The public not only needs to know the government’s budget plans, but more importantly, they need to know how much the government actually spends, as well as what things and purposes that money is put toward,” said Chen Shu, a deputy to the 11th National People’s Congress (NPC), China’s top legislature.

Premier Wen Jiabao also said in his government work report to this year’s NPC session the government would speed up its attempts to make the budgetary plans public.Many NPC deputies saw his remarks as indicating the government’s determination to become more transparent.

CFP

“We still need relevant laws to clarify the ways government budget plans and fiscal expenditure are disclosed, and clarify how detailed the information can be.”

—Jiang Hong, a CPPCC National Committee member and professor at the Shanghai University of Finance and Economics

A meeting of the State Council decided in late March the Central Government would report the fi nal spending accounts to the NPC in June, and make the accounts available for public supervision. Most importantly, the report will include three big items of government spending—of fi cials’ overseas trips, the procurement and maintenance of government cars and the fees for of fi cial receptions.They are estimated to cost taxpayers 900 billion yuan ($132 billion) a year, which represents about 30 percent of the total government expenditure.

China’s curbing on extravagant spending by of fi cials saved the country 5.7 billion yuan ($863 million) last year, said Wu Yuliang, Secretary General of the Central Commission for Discipline Inspection of the Communist Party of China.

Trying to be open

In early April, several ministries began to release their budgets for the year, answering the call of the Central Government for government departments at all levels to take initiatives to publicize their budget information, and it was the second time they had done so since 2010.

The Ministry of Finance posted its budget plan for the year on April 1 on its of fi cial website, a document containing more detailed information than was released in 2010.One of its balance sheets included in the budget disclosure shows the ministry plans to spend 2.6 billion yuan ($395 million) in 2011, up 6 percent from the past year.

The State Food and Drug Administration revealed its budget plan of 805 million yuan($118 million) this year on April 2. But, the disclosure gave fewer details than what was given out by the Ministry of Finance.

The go-transparency initiative is not just a concern of the Central Government but also local authorities. Various departments of the municipal government of Beijing have actively set out to release budgets with details. They have publicized information about spending 40 million yuan ($5.8 million) on new of fi cial vehicles this year.

As early as in 2009, the municipal government of Guangzhou, capital of south China’s Guangdong Province, released its annual accounts on the Internet for the fi rst time. The public could download the 2009 Guangzhou Municipal Department Budget from the website of the Guangzhou Finance Bureau. The document contains detailed budgets of 114 municipal government departments.

In 2010, more than 70 central government departments posted their budgets on the Internet. In the same year, 12 provincial governments, including those of Yunnan Province and Chongqing Municipality,published their spending statements on a monthly or quarterly basis.

Greater requirements

The publishing of government spending information somehow remains a formality when it comes to details of the information released. For example, both the Ministry of Finance and the State Food and Drug Administration failed to provide in this year’s budget reports spending information on offi cial vehicles, receptions and overseas trips,which always elicits concerns from the public.

LI SHIGONG

Though this year the central government’s budget report to the NPC released its spending in 18 categories, deputies said the report did not contain enough detail.

“It only has general figures,” said NPC deputy Chen. “The expenditure in the smallest category comes to tens of billions of yuan. We still don’t know the details of how the Central Government used the money.”

Ma Jun, a professor at the Guangzhoubased Sun Yat-Sen University, said it’s imperative that government financial statements cover both how the government intends to spend its budget and, then, where the money actually goes.

The Ministry of Finance would publish the main parts of the 2011 central budget and balance sheet, which will contain more details than were released in 2010, said Dai Bohua, the ministry’s spokesman during an interview in early March.

“I think by making the budget public the government will win more trust from the people,” said Jiang Hong, another CPPCC National Committee member and Director of the Public Policy Research Center af fi liated to the Shanghai University of Finance and Economics. “Besides aiming for greater transparency, I hope they will publish balance sheets that are easier for the people to understand.”

Regulation

It has been three years since China’s Regulations on the Disclosure of Government Information took effect in May 2008. Therefore government spending is de fi nitely the information that citizens have every right to know about.

But most local governments declined the request of budget disclosure with an excuse of “confidentiality,” said Wu Junliang, the fi rst Chinese activist for government budget publicity.

Jiang said more needs to be done to regulate the disclosure of government spending.

“We still need relevant laws to clarify the ways government budget plans and fi scal expenditure are disclosed, and clarify how detailed the information can be,” Jiang said.

The current Budget Law, which was enacted in 1994, has only a few unspecific regulations about the government spending information publicity, Jiang said. “It’s fundamental to amend the law to improve the budgetary work and make government budgets more transparent to the public.”

At this year’s session of the CPPCC National Committee, Jiang made nine proposals to amend the Budget Law, suggesting the supervisory power of the NPC on budget management should be strengthened, and the terms and clauses on the budget information disclosure should be detailed rather than rough and general statements.

China’s top legislature was set to review a draft amendment of the Budget Law in August 2010, but the review was postponed.It again failed to be included in the legislative agenda of the NPC Standing Committee this year and the timetable for amendment remains undecided.

“When administrative power grows far stronger than the power of the legislative body, the amendment of the law can be too difficult,” said Li Weiguang, a professor at Tianjin University of Finance and Economics.

But Jiang is still positive about the future of budget disclosure. “If all the possible technical problems are solved, China is expected to reach international level in public spending transparency in three years,” he said.

Officials’ overseas trips,the procurement and maintenance of government cars and PR are estimated to cost taxpayers 900 billion yuan ($132 billion) a year, which represents about 30 percent of the total government expenditure