New regulations set to manage military expenditure

China will implement strict management of military expenditure to ensure efficiency and introduce an evaluation system to hold individuals or units accountable for inefficiency.

China's Central Military Commission (CMC) has approved the implementation of a performance evaluation system, which aims to optimize the allocation of financial resources, improve cost controls and maximize the output of spending, according to a circular issued by the General Logistics Department of the People's Liberation Army (PLA), which was made public on Sunday.

This will help provide dependable financial support to realize the country's goal of establishing a powerful army, experts said.

The system will be piloted this year at the PLA headquarters and regional military commands in five areas, including purchases of military equipment used in simulations. It will be spread to all areas of military expenditure by 2020.

Zhao Keshi, head of the PLA General Logistics Department, said that the system will be related to military spending and focus on how this spending is allocated, used and supervised.

The system will run in four phases, including setting budget targets, monitoring budget execution, making performance evaluations and making improvements based on feedback.

Individuals or units who fail to fulfill performance targets or use the budgets inefficiently will be held accountable, said the circular.

The system will ensure military funds are effectively transferred into combat capability, Zhao said.

"This new management system will make military spending more transparent and scientific and reduce corruption in the army," Xu Guangyu, a senior consultant at the China Arms Control and Disarmament Association, told the Global Times on Sunday.

The PLA has seen a spate of public pledges of loyalty to the Communist Party of China (CPC) among the leadership following a corruption probe into former CMC vice-chairman Xu Caihou in June, who retired from that post last year.

He has been expelled from the CPC for suspected bribery.

His case has been handed over to military prosecutors.

The CPC also announced on Thursday that Yang Jinshan, deputy commander of the Chengdu Military Area Command, was expelled from the Party for disciplinary violations.

Detailed implementation methods of the system drew wide attention as some feel unclear about how to evaluate military outcomes during periods of peace.

"We don't evaluate military performance by provoking a war. For example, we could test soldiers' combat capability through emergency tasks, to examine whether they have made progress via military drills and to check on weapon maintenance works. These will provide the basis for the evaluation system," said Xu Guangyu.

"About one-third of our nation's military expenditure is used on military training and drills, which is less than that of Japan and the US. An efficient management system is of great necessity to make sure that every penny of military fees is spent in the right place [when the budget is tight]," he stressed.