Official expenses become more open

Updated: 2012-05-14 07:20

By Zhao Yinan (China Daily)

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Central government departments have been disclosing to the public their annual budgets in recent weeks, a move that seemed unthinkable just a few years ago. Yet, despite the progress being made in fiscal transparency, experts say the data being released is still too vague to satisfy the taxpayers' demands.

This year is the third time authorities have revealed their revenues and expenditures, following the introduction of new rules on spending that came into effect in 2008.

So far, 92 out of the government 98 departments and State-funded organizations have laid bare their accounts since April 23 - the same number as last year and 18 more than in 2010.

This year's fiscal reports include some new elements, such as explanations of expenditures, indicating efforts to enrich the previous one-page sheets provided for public scrutiny in the early days of fiscal disclosure.

"We can see progress, but there is a lot of room for improvement," said Jiang Hong, a professor of public finance with the Shanghai University of Finance and Economics.

In an unprecedented move, the amounts authorities received through charges, such as the education surtax for businesses and Civil Aviation Fund as well as the spending of government funds, were for the first time included in the annual budget, in an attempt to meet the central government's requirement of a "complete" fiscal report.

The Civil Aviation Fund, for example, was introduced in April by the Ministry of Finance to replace two fees previously levied on air passengers to raise funds to improve the country's aviation sector.

Jiang said by bringing the fund under government budgetary management, arbitrary use of the money can be avoided to some extent.

In addition to efforts to make it more complete, this year's budget is also presented with more explanatory notes.

"Many departments included charts and illustrations, and some also explained the reasons for significant changes in the budget," said Ye Qing, deputy director of the Hubei provincial statistics bureau.

The right of the public to challenge governments' spending was granted in 2008, when the country enacted the Government Information Disclosure Regulation. The rules require governments at all levels to "take the initiative to disclose fiscal information to the public", and the regulations have compelled departments under the central government to disclose spending in 2010.

Previously, reforms have been ongoing at the grassroots level.

The government in Shenzhen, Guangdong province, agreed to pose its fiscal report online for public scrutiny as early as 2008.

"I'd sent hundreds of requests to governments in different areas, and all of them were being turned down or simply ignored before the Shenzhen government accepted it," said Wu Junliang, a businessman and a long-time campaigner for fiscal transparency. "I feel like I'm a blind person who finally can see the world."

The rare information became an instant hit with residents, said the 54-year-old, and the city government's website where the information is posted collapsed on the second day.

"A non-transparent government has the potential of being more irresponsible, but once the information is open, changes come along," said Ma Jun, a professor of public governance at Sun Yat-sen University.

As for this year's public spending plans, the professor said they have improved in terms of efficiency and form but there is still far to go.

"Budgets should be understandable," he said, calling that a prerequisite for the public to judge the legitimacy of spending.

In addition, fiscal reports revealed to the public are mostly made along functional lines, which reflect major categories of spending, such as education or agriculture, but do not reveal the purpose of the expenditure.

For the Ministry of Education, the functional budget divides the money into categories such as higher, primary and occupational education. Under the economic budget, spending is earmarked according to its purpose, such as salary, welfare or overseas trips.

"It is like the government just opened half of its books, and the latter half is much more important for the public," Ma said.

The most controversial spending - receptions, vehicle purchases and maintenance, and overseas travel - will be "put in broad daylight" once they open the latter half, Ma said.

Additionally, budgets should be published in a timely manner.

"Already half a year has passed, but the budget released this year to the public is still incomplete," he said.

Jia Baolan, a member of the National Committee of the Chinese People's Political Consultative Conference, the country's political advisory body, proposed at its annual session in March to amend the country's Budget Law and change its budget year.

The country's fiscal year runs from January to December, which means the public spending plans have already gone into effect when lawmakers review them at the annual plenary session of the top legislature, the National People's Congress, also in March.

Ma, who called disclosure of public spending an "inevitable trend", said it will be an uphill battle to reach the goal of fiscal transparency in China, and authorities need to be given time to adapt.

"Publication does not necessarily means transparency, and we have to give governments time to wash their face before they meet guests," he said.