Building a Clean, Efficient, Service-oriented Government

THE State Council unveiled last March the cabinet reshuffle plan to reduce ministries under the State Council from 27 to 25 and integrate various government departments and agencies.

The Ministry of Railways was dissolved and its functions as railway regulator and service provider separated into two arms. The Ministry of Health and the National Population and Family Planning Commission merged， as did the two media regulators – the General Administration of Press and Publication and the State Administration of Radio， Film and Television. The State Food and Drug Administration was elevated to a ministry-level general administration. The State Oceanic Administration and National Energy Administration also underwent restructuring.

This is the seventh major administrative reform since China first implemented reform and opening-up poli- cies three decades ago. The reform’s fundamental purpose is to build a wellstructured， clean， efficient and serviceoriented government with scientifically defined functions.

Well-designed Reform

The State Council is China’s cabinet and hence the core of the country’s administrative system. Its restructuring， therefore， is both topical and of farreaching significance.

The reshuffle is much more than a“mega-ministry reform，” or an initiative to integrate similar administrative functions into one big ministry.

Taken as a whole， the plan is the first of its kind to adjust the functions of government according to its relations with the market and its position in society. The plan takes into full consideration the government’s administrative functions， the market’s fundamental role in allocating resources， and people’s participation in the management of social affairs. Such a reform concept correlates with the general trend of reform to public administration worldwide， as well as with China’s current reform and development needs.

Meanwhile the functions， structure and operation models of government departments are to be adjusted to appropriately divide power and responsibilities among departments under the central government and between the central and local governments.

All rounds of administrative reform carried out in China over the past three decades center on two closely related themes： transforming government functions and optimizing government structure. On one hand， structural adjustments cannot be made without functional transformation； on the other， functional transformation must be realized through structural adjustment.

The emphasis of the new reform plan is on improving and innovating government institutions and management methods and integrating government functions. First， identical or similar functions originally carried out by various government departments should be the responsibility of a single department. Second， various organizations performing identical or similar functions should be merged into one. Third， resources （such as forests， grassland and farmland） formerly managed by various government departments should come under just one.

These principles are reflected in the cabinet reshuffle. For instance， the function of railroad regulator， originally carried out by the former Ministry of Railways， has been transferred to the Ministry of Transport.

In addition to adjusting the functions of central government departments， the new reform plan also addresses the division of power and re-sponsibilities between the central and local governments.

For instance， according to the plan， the power to approve investment projects and production and operation activities should be delegated to local governments. Special transfer payments to local governments for designated purposes should be significantly reduced， while general transfer payments to local regions should increase.

These reform measures will enable local governments to better respond to local people’s needs and make their work more efficient and effective.

The plan enhances the fundamental constituents of the administrative system， which represents a significant achievement.

The fundamental goal of administrative reform in China is to build a sound governmental system to operate a socialist state with Chinese characteristics. Any country looking to develop needs a relatively stable basic operational system based on the rule of law. After 30 years of reform， this is now feasible in China.

This round of reforms also includes measures to build the institutional infrastructure for effective public administration， including a unified real estate registration system， a social credit coding system and a real-name registration system for Internet access and financial accounts.

These reform measures are in line with the current international and domestic situation. The economy is at present under relatively heavy downward pressure， which makes maintaining social stability an arduous task. In light of this situation， the plan states that maintaining general structural stability of the State Council is foremost. Compared with the central government reshuffles in 1998 and 2008， therefore， this round is relatively moderate and prudent.

There is a high degree of consensus on this occasion as to what central government departments need to reform and how to go about it. For controversial issues and measures， there is no haste to press on until a broad agreement is reached and the time is ripe. This demonstrates that the institutional reform is a dynamic process that adapts to China’s social and economic development.

Small， Efficient Government

The purpose of this round of reforms is to clarify the relations between government， market and society， to streamline government departments and to decentralize government power and unleash the vitality of the market and society. That is to say， politics should be separated from the management of enterprises， state assets， public institutions and social organizations. The government will hence refrain from micromanagement and delegate power to the market and society.

Meanwhile， the government will also strengthen macro-management and supervision. It will do what it should do， and do it well.

Until now， the government has made itself responsible for too many matters. Zhang Youxi， chairman of Datong Coal Mine Group and a deputy to the National People’s Congress， recently said that to obtain administrative approval for an investment project， his company had to go to 33 government departments and their subordinate agencies to get the required 147 documents and the requisite 205 stamps.

Likewise， earlier this year Cao Zhiwei， a member of the Guangzhou Committee of the Chinese People’s Political Consultative Conference， made a flowchart illustrating the project examination and approval process that showed how the entire process takes 799 working days.

This cumbersome approval procedure constitutes a heavy burden on government departments and also gives rise to rent-seeking behavior and corruption.

The reform plan includes specific measures that address these problems. For instance， it will reduce or simplify administrative examination and approval requirements for investment projects， production and business operation activities， and qualification and license applications. It will also slash administrative charges and reform the business registration system.

The government will allow the market to play a fundamental role in allocating resources while strengthening supervision over it.

The government will also allow social organizations to play a bigger role in managing social affairs.

Social organizations in China are neither nurtured nor properly regulated. The threshold for setting up nongovernmental organizations （NGOs） is so high that many have gone into operation without registering with the government. Some NGOs are run like government organizations. The existing administrative system hence hampers orderly development of social organizations， which is why a modern system should be set up. The reform plan also includes specific measures in this respect.

For instance， the plan states that industrial associations and chambers of commerce should stand separate from administrative departments， and that a competitive mechanism should be introduced that fosters their independence and vitality.

The government gives priority to the establishment of industrial associations and chambers of commerce， organizations in the field of science and technology， and charities and organizations delivering community services. According to the plan， such NGOs can register directly with civil affairs authorities without prior examination and approval from other supervising agencies. NGOs specializing in legal and religious affairs and foreign NGO representatives in China are not， however， covered under this new reform measure.

The government will encourage the development of NGOs， but meanwhile strictly manage them by law to ensure they establish strong internal governance， and promote their healthy and orderly development. These reform measures will greatly promote social management and social innovation.

To sum up， the latest bout of State Council overhaul is promising in several respects. But what cannot be overlooked is that any administrative reshuffle involves function and personnel changes that， if not wisely handled， will hamper the smooth operation of the government. And the decentralization of power also requires strong supervision.