New Account System to Check Misuse of Funds

Guangdong Province, a reform-pioneering province in south China, plans to experiment with the treasury single account system, a kind of new system under which payment for government-funded projects will be directly made by the exchequer.

Beginning in the second half of this year, Guangdong would adopt the system for all local construction projects involving the use of government funds, said Provincial Governor Lu Ruihua, a deputy to the Ninth National People's Congress (NPC) who is currently attending its 3rd annual session.

The new account system will be in taxpayers' interests and commensurate with Premier Zhu Rongji's statement that "reform of the administration and management system should be deepened to strengthen supervision and restraint mechanisms" in his government work report to the on-going NPC session on Sunday.

At a meeting of the NPC session this morning, Xiang Huaicheng, minister of finance, said, "we will undertake to study how to implement the treasury single account system as a basic measure to tighten management, combat corruption and thus help build a clean and honest government."

The payment system will make the financial work transparent and check the misuse and even deflation of funds for construction projects by local governments, units or individuals, while enabling banking departments to control and utilize funds still more effectively, in a bid to avoid repeated, overlapped construction and wastes, according to a Finance Ministry spokesman.

The finance minister further noted that violations of relevant regulations and law-breaking activities are rather serious in banking and economic work; financing cannot be fully guaranteed; the pace for readjusting spending patterns, though already initiated, are still too slow and too ineffective.

These reform measures constitute "a major component part of the current banking reform and an objective requirement for implementing the principles of administering the country by law and ensuring that the government performs its duties in compliance with the law.

Moreover, it is a necessary requirement for increasing economic and budgetary supervision and a very effective means of building a clean and honest government through the methods of improving the banking system."

This year, the central government plans to appropriate as high as 89.3 billion yuan (10.8 billion US dollars) to capital construction and issue another 388 billion yuan (45.5 billion US dollars) of treasury bonds for investment in this sector. Meanwhile, local governments will invest handsomely in infrastructure. And some local observers acknowledged that the use of these funds will surely produce great effects on the country's economic growth.

Back to top
Copyright by People's Daily Online, All rights reserved