Slush funds target of huge crackdown

BEIJING,April29-- The Ministry of Finance has launched a massive seven-month crackdown aimed at drying up slush funds that illegally use billions of yuan each year of government money.

The slush funds, which are known as "small treasuries", are understood to be widespread within the State sector.

The practice was described as "the root of collective corruption" by Liu Xirong, vice-chairman of the National People's Congress Law Committee, who called for it to be listed as a crime under China's criminal law.

The crackdown will encompass all party organs and public institutions - especially those that are state-funded.

Informants who help investigators may be eligible to receive up to 100,000 yuan (14,645 U.S. dollars), according to a notice released by the ministry on its website (www.mof.gov.cn) yesterday.

The slush funds are essentially secret accounts set up by Party organs and public institutions to collect extra revenue from collective moonlighting activities. The accounts are used to pay additional funds to managers and workers.

"After the economic reform, workers and staff became increasingly dependent upon extra income distributed openly or secretly by their work units," said a recent joint study by researchers Xie Yu and Wu Xiaogang.

These earnings "accounted for about one-third to 40 percent of workers' total income in the 1980s, and overtook normal salaries in the mid-1990s," said the scholars.

Auditors found 13 billion yuan (1.9 billion U.S. dollars) of illegal "small treasuries" in the first half of 2006, according to earlier reports. An additional 140.6 billion yuan (20.6 billion U.S. dollars) was identified between 1998 and 2006.

The National Audit Office believes central government departments misused or mismanaged more than 46 billion yuan (6.73 billion U.S. dollars) in 2007.

The Communist Party of China's (CPC) discipline watchdog last week said some 881,000 Party officials involved in 852,000 cases were punished for misconduct in the past five years.

President Hu Jintao in January urged the anti-corruption body to "firmly correct official wrongdoing". The crackdown is a joint effort of the CPC Central Committee for Discipline Inspection, the Ministry of Supervision, the Ministry of Finance and the National Audit Office and is headed by Finance Minister Xie Xuren.

(Source: China Daily)

China's first expressway hikes tolls to raise funds for expansion

SHENYANG, April 18 (Xinhua) -- Ma Yinghong got a surprise on his way to a
friend's wedding this week, when he found that the toll for his trip on the
Shenyang-Dalian Expressway had risen to 155 yuan (22.50 U.S. dollars) from 120
yuan.

Staff at the toll booth showed Ma a notice on the wall, which said that
tolls on all 15 expressways in Liaoning Province had risen about 20 percent on
April 10.

"Why did they raise the tolls?" asked the bank clerk, who lives in the
provincial capital of Shenyang. He was headed to the coastal city of Dalian for
the wedding.

Liu Mingzhu, deputy transport chief of Liaoning, told Xinhua Friday that
the tolls were raised because the transport administration needed more money for
debt service.

The 348-kilometer expressway, China's first, was built starting in 1984.
But that expressway, and the 14 others built since then, are no longer adequate
for the traffic in Liaoning.

Building more roads meant the province would have to borrow about 90.6
billion yuan, which would mean annual debt service of 7billion yuan. But the
provincial expressways' annual revenues are only about that much, so almost
nothing would be left over for maintenance and other expenditures, the official
said.

The province had 2,700 km of expressways as of the end of 2008.Another
1,300 km are either under construction or planned, at a total cost of 16 billion
yuan.

"When tolls fail to cover costs, the authorities will raise tolls to ease
the burden," said Xiao Xingzhi, a professor at the Research Academy of Economic
and Social Development, Dongbei University of Finance and Economics.

Xiao said he was concerned that higher tolls might keep drivers off
expressways, reducing revenue and worsening the debt situation. He also
expressed concern that other parts of China would follow Liaoning in raising
tolls.

The Shenyang Jingwei Passenger Transport Company, which operates more than
100 routes, faces a deficit because of the higher tolls in Liaoning. A manager
surnamed Sun said it would cost the company an extra 3 million yuan a year to
pay the higher tolls.

Ma, who owns a car and often travels between Shenyang and Dalian, said he
would avoid travel on expressways in the future.

In 2004, China drew up a regulation on highway tolls that stipulates a maximum
of 15 years of toll collection after a highway opens. When the 15 years is
up, the highway is supposed to be free for all.

The Shenyang-Dalian Expressway cost 2.2 billion yuan and fully opened to
traffic in 1990. It underwent a 7.2 billion-yuan renovation from 2002 to 2004,
expanding from four lanes to eight.

Cao Wenbin, head of the provincial expressways administration, said the
province had no individual debt service schedule for each expressway, and it had
not set a date to abolish tolls on the Shenyang-Dalian Expressway.

All expressways in Liaoning are publicly owned. Public-private partnerships
are common in other parts of China.

At the end of 2008, there were 60,300 km of expressways in China, the
second-largest amount in the world after the United States, which has nearly
100,000 km.

Travel on public funds trimmed

BEIJING, April 7 -- Officials who hope to take a little trip this year will find there's been a cut in the budget.

Government spending on trips will be cut 20 percent this year in an effort to crack down on officials spending public money on sightseeing tours overseas, a notice on the Beijing municipal government's website said.

"Party and government officials must not misuse public funds for overseas tours and must not demand any subsidy or financial assistance from any institution or enterprise," the authorities said.

The municipal government singled out the use of fake letters sent by bogus overseas groups inviting officials on personal trips at public expense and said no reimbursement would be given in those situations.

The Chinese media have reported a string of scandals involving officials going on overseas trips, spending their time shopping and sightseeing with public funds.

In August 2007, Xu Wen'ai, vice-procurator-general of Anhui province, was removed from his post for wasting public funds on a trip to Finland.

A delegation of 10 people from the procuratorate headed by Xu was found to have fabricated an invitation from the Finnish government.

Ren Jin, a professor with the National School of Administration, said the efforts could significantly curb violations.

"But the same monitoring and restrictions should be applied to the domestic trips, which sometimes cost much more than overseas tours," Ren said.

In a recent case, villagers from Xinzhung village of the capital's Fengtai district tried to prevent village officials from leaving town when they learned the officials were heading to Guangxi for sightseeing tours, the Beijing News reported.

"They travel for fun on public funds," a villager surnamed Yang was quoted as saying.

Villagers failed to block the buses and the officials successfully made the journey, which they explained as "a trip to study and learn how other villages get wealthy". Authorities are investigating the case.

The latest move by the Beijing municipality follows a similar nationwide campaign, jointly announced by the Ministry of Finance.

China banned nearly 4,000 people from attending more than 550 overseas group trips on public expense during the May-November period last year, Xinhua reported earlier.

Now overseas trips for Beijing officials will have to adhere to a strict schedule, with finance departments working out annual budgets.

The departments involved in sending officials on trips should thoroughly inspect the bills submitted by officials and report claims to the municipal finance bureau for approval before reimbursing anyone.

(Source: China Daily)

Beijing municipal gov't trims travel on public funds

BEIJING, April7 -- Officials who hope to take a little trip this year will find there's been a cut in the budget.

Government spending on trips will be cut 20 percent this year in an effort to crack down on officials spending public money on sightseeing tours overseas, a notice on the Beijing municipal government's website said.

"Party and government officials must not misuse public funds for overseas tours and must not demand any subsidy or financial assistance from any institution or enterprise," the authorities said.

The municipal government singled out the use of fake letters sent by bogus overseas groups inviting officials on personal trips at public expense and said no reimbursement would be given in those situations.

The Chinese media have reported a string of scandals involving officials going on overseas trips, spending their time shopping and sightseeing with public funds.

In August 2007, Xu Wen'ai, vice-procurator-general of Anhui province, was removed from his post for wasting public funds on a trip to Finland.

A delegation of 10 people from the procuratorate headed by Xu was found to have fabricated an invitation from the Finnish government.

Ren Jin, a professor with the National School of Administration, said the efforts could significantly curb violations.

"But the same monitoring and restrictions should be applied to the domestic trips, which sometimes cost much more than overseas tours," Ren said.

In a recent case, villagers from Xinzhung village of the capital's Fengtai district tried to prevent village officials from leaving town when they learned the officials were heading to Guangxi for sightseeing tours, the Beijing News reported.

Villagers failed to block the buses and the officials successfully made the journey, which they explained as "a trip to study and learn how other villages get wealthy". Authorities are investigating the case.

The latest move by the Beijing municipality follows a similar nationwide campaign, jointly announced by the Ministry of Finance.

China banned nearly 4,000 people from attending more than 550 overseas group trips on public expense during the May-November period last year, Xinhua reported earlier.

Now overseas trips for Beijing officials will have to adhere to a strict schedule, with finance departments working out annual budgets.

The departments involved in sending officials on trips should thoroughly inspect the bills submitted by officials and report claims to the municipal finance bureau for approval before reimbursing anyone.

(Source: China Daily)