No. 30 of 2015 (General SerialNo. 227): The Real-timeAudit Results of the Implementation of Measures and Policies about Stabilizing Growth, Promoting Reform, Adjusting Structure, Improving People’s Livelihood and Preventing Risks in August of 2015
(June 28, 2015)
In August of 2015, the National Audit Office conducted tracking auditing on the implementation of measures and policies about stabilizing growth, promoting reform, adjusting structure, improving people’s livelihood and preventing risks of 29 provinces, autonomous regions and municipalities directly under the central government (hereinafter generally referred to as province) and 29 central departments and 7 central enterprises. The auditing work focused on the implementation of people’s livelihood policies such as the affordable housing projects, precise poverty alleviation and the old-age service industry and of the public entrepreneurship and innovation policies,on the advance of the major construction projects andon revitalization of the financial stock of the central departments. It examined 498 units and 815 projects, involving total project capital of RMB708.014.
According to the auditing results, the relevant departments and regions formulated and improved related policies and measures to promote economic restructuring and to change economicdevelopment pattern and achieved positive results. For instance, Bozhou city of Anhui province explored the use of the Internet and big data technology and integrated the related electronic data of 44 departments such as Departments of Public Security, Industry and Commerce, Human Resources and Social Security etc. to build the basic database of population,legal person and electronic business licenses as well as to build the data exchangingand sharing platform, on the basis of whichit developed the online business hall performing many functions including information disclosure, online business etc. As a result, it simplified the government work flow and improved the efficiency of administrative examination and approval. The enterprise registration time was shortened from 20 working days to within 5 working days. Chongqingactively establishedand improved the related system and promotedreforms of the PPP investment and financingand of other key areas. Since 2014, Chongqing has signed 39PPP project cooperation agreementsrelated to some traditional areas such as highway, municipal water supply and waste disposal as well as some new developed areas including the rail transit,first levelland reclamation, public parking building, medical and health care, with a totalinvestment of more than RMB2500 for signed projects.
But the audit also found that some departments and regions still had some problems in implementing the policy of the people's livelihood as well as public entrepreneurship and innovation policy. Some key construction projects progressed slowly, and some units did not clear up the activating existing stock funds in time. They mainlywere:
I.Some of the people's livelihood policies were not implemented thoroughly, and relevant projectsprogressed slowly.
(I) The operating rate of the renovation of rural dilapidated buildings was low. Some of already built affordable housings had been idle or been used for other purposes. In 2015, the central government arranged 4.32 million rural dilapidated building renovation tasks, of which 2.453 million(56.8%) had started construction by the end of August 2015. 10 provinces, due to inadequate preparation and delayed matching funds, had a lower operating rate than 50%; Some regions of three provinces made a false report about the operating tasks,and some already built affordable housings had been vacant for a long time or been used for other purposes.
(II) Some regions did not implement the precision poverty alleviation work properly. Funds were not allocated timely to the objects of poverty alleviation or allocated to those who were not designated as objects for poverty alleviation.
(III) Some regions failed to timely issue the program and related measures of developing health services and old-age services. Old-age services facilities’ construction lagged behind, and complement departments lacked in supervision on carrying out the policy regarding rural doctors.
II. The implementation of public entrepreneurship and innovation policy was not carried out thoroughly in some regions and under some competent authorities.
(I) Small and micro enterprises still had common difficulties in financing. They were still financing at a higher price. Problems were mainly the general high financing cost and long time for getting financing approval, someof which were attached with additional conditions; For small and micro enterprise loans, some of the commercial banks did not fulfill the service goal of "three-no-less-than" (small and micro enterprises’ loan growth should not be less than the average loan growth, loaning number should not be less than that of the last year, and the loan obtaining rate should not be less than that of the same period last year).
(II)The construction of the national university science park of five universities deviated from the policy objectives, and the use of the park sites and the number of enterprises occupying the park did not conform to the standard.
III.The construction of some key projects progressed slowly
193 out of all the audited construction projects(accounted for 23.7%) apparently progressed behind schedules, involving an investment of RMB286.862 billion.
(I) By the end of August 2015, among the 333 railway projects under construction, the completion rates of 99 projects’ annual investment plan were less than 50%, involving an investment of RMB173.724 billion, of which the completion rates of 20 projects’ annual investment plan were less than 10%, one completed project was idle for 19 months, and RMB1.175 billion investment was not effective.
(II) In 2015, the central government invested RMB12.433 billion in major agricultural water-saving engineering in 29 provinces. By the end of July only RMB708 million was completed. The progress had been slow.
(III) The “dead end highway” of seven national expressway networks of four provinces should have started work but have not; The progress of some of the highway construction projects of two province lagged behind.
(IV) China Southern Power Grid and three major telecom operators including China Mobile, China Unicom, China Telecom had some projects construction lag behind.
In addition, the audit also found that some projects approved by National Development and Reform Commission in the previous year had notbeen dealt with in time.
IV. Some departments and regions had not streamlined administration or delegated power to the lower levels.
(I) Some subordinate units of central departments or local units, relying on administrative resources, operated illegal activities or charged fees without proper grounds. For instance, China National Institute of Standardization, a subordinate of AQSIQ(Administration of Quality Supervision，Inspection and Quarantine) gained RMB21.3483 million by making use of public resources and enlisting someself made standards. Land Resource Department in Zhejiang province and Ministry of Construction in Hubei province charged fees by conducting monopoly intermediary services and so on.
(II) Some regions did not commit enough effort in promoting commercial system reform and facilitating customs clearance. For example, Yunnan province still had some restrictive requests about registered capital to price assessment institutions who applied for registration; Nanning Customs and Inspection and Quarantine Bureau of Guangxi lacked adequate coordination in promoting clearance and inspection cooperation and in reforms of "three ones" ("one declaration, one inspection and one release"). The actual progress was slow.
V. Some of the central government departments and regions failed to completely and timely clear up and liquidize remnant assets.
(I) Vehicle purchase tax subsidizing local construction project funds resulted in large amounts of transferred account balance; Approval of central governmental funds and some special transfer payment funds in general public budget were issued slowly.
(II) The National Tax System and the Civil Aviation Administration had failed to thoroughly clear or liquidize remnant assets. The previously recovered annual fiscal surplus funds failed to be transformed to the actual expenditure, resulting in secondary precipitation.
(III) Inner Mongolia autonomous region had failed to thoroughly liquidize remnant assets, with RMB797 million balance remaining in departments.
The audit inspected the reform and rectification of problems found in the tracking audit in earlier stage. According to the inspection results, relevant departments and local governments had earnestly reformed and rectified problems found in the tracking audit and achieved positive results. For example, on the problem of illegally delaying putting annual tax in storage, the National Tax Bureaus concerned, in accordance with the audit opinions, had already turned over RMB15.963 billion of taxes collected from 15 enterprises to the State Treasury; Shenzhen had already canceled the self-appointedprofessional qualification confirmation for supervisor and supervision engineer, etc. However, some individual regions and departments had failed to timely and roundly reform and rectify problems found in the audit. For instance, the Ministry of Culture had not cleaned up the carried-over fund of RMB47.173 million in projects of the Oriental Performing New Media and the Prospering Art and Culture Creation in 2012 and the year before; The Ministry of Civil Affairs had not takentimely and specific measures to improve and implement the supporting system for the extremely poor people; Health and Family Planning Commission of Shandong Province declared two projects of instrument installation of heavy metal pollution biological monitoring laboratory in 2011 albeit the projects has not been implemented by the end of August.
Attachment: Main Problems Found in the Audit
I. Some of the people's livelihood policies had problems in their implementation. They mainly were:
(I) Some of the affordable housing projects had low operation rates or made false reports about the operating tasks. Some of the already built affordable houses had been idle for a long time or been used for other purposes. Urban and Rural Housing Construction Ministry assigned a task of reforming 4.32 million rural dangerous buildings in 2015. By the end of August in 2015, 2.453 million (56.8%) buildings had started construction, among which 10 provinces had a operation rate lower than 50% because of inadequate preparation and delayed matching funds.
The operation situation of rural dilapidated building renovation in 10 provinces are as follows:
Number / Province / Number of households assigned by central government / Operation situation of tasks assigned by central governmentOperated households number / Operation rate
1 / Hunan Province / 208000 / 51555 / 24.8%
2 / Guangxi Province / 297000 / 76911 / 25.9%
3 / Jiangsu Province / 43000 / 12965 / 30.2%
4 / Shanghai Province / 1000 / 305 / 30.5%
5 / Shangdong Province / 92000 / 28466 / 30.9%
6 / Yunnan Province / 460000 / 144171 / 31.3%
7 / Henan Province / 262000 / 108000 / 41.2%
8 / Hebei Province / 172000 / 75157 / 43.7%
9 / Anhui Province / 176000 / 79238 / 45.0%
10 / Hubei Province / 124000 / 60000 / 48.4%
According to the audit, Datong city of Shanxi Province made false reports that 31,054 sets of rural affordable houses had been put into operation in 2015. By the end of July, Xiaoshan District of Hangzhou City, Zhejiang Province had not begun to carry out the work such as accepting public renting application of idle houses etc., resulting in 546 of the 626 sets of affordable houses being idle for more than 2 years, among which 448 sets being idle for more than 4 years. Fengjie County of Chongqing Province had been illegally using low-renting houses for other purposes since 2013. The County Finance Platform Company used fiscal capital of RMB25 million to buy 210 sets of low-renting houses and transformed them into the office buildings and rent those houses to the county party committee and county government organs.
(II)Mashan County of Guangxi Autonomous Region had failed to give strong promotion to the targeted poverty alleviation task. Firstly, by the end of July 2015, the special account of financial poverty alleviation fund of the county carried over a balance of RMB92.3414 million, accounting for 43.73% of the county’s public finance income in 2014, among which the year before 2014 carried over a balance fund of RMB70.5614 million, resulting in slow advances of many poverty alleviating industries such as passion fruit planting industry and of infrastructure construction projects such as paving road with sand and pebbles in poor villages, which affected the implementation effect of some poverty alleviation policies such as the whole village promotion policy and the household industrial poverty alleviation policy etc. Secondly, among the targeted poor of Mashan County, 3119 people did not conform to the poverty alleviation filing standards, among which 343 people belonged to the fiscal support personnel, 2454 people bought 2645 cars and 43 people bought commercial houses in the county or built housing by themselves, 439 people were individual industrial and commercial households or ran a company. Thirdly, in order to fulfill the task assigned by the superior department, Mashan County assumed that 2272 people of 608 households, whose per capita net income were lower than the nation’s poverty standard of RMB2736, had already overcome poverty, who accounted for 9.10% of households and 8.90% of people having been lifted from poverty.
(III) Yunnan Province had failed to timely appropriate RMB1.425 billion of the central fiscal special poverty relief funds of 2015. In November 2014, the Financial Department of Yunnan province received in advance from the Ministry of Finance the central fiscal special poverty relief funds of RMB3.376 billion of 2015. By the end of July 2015, there were still RMB1.425 billion that had not yet been allocated to the county or to corresponding projects.
(IV) Hainan Province and Ningxia Autonomous Region had failed to timely make specific implementation plans or methods to promote the development of health services and old-age service industry. Firstly, by the middle of August, 2015, Hainan Province had failed to fulfill the requirements of the State Council and make relevant plans about how to promote the health care service industry. Secondly, in order to implement Several Opinions of Accelerating the Development of Old-age Service Industry Issued by the State (State [2013] No. 35), in May of 2014, Ningxia Autonomous Region issued Implementation Opinions of Accelerating the Development of Old-age Service Industry (Ningxia government [2014] No. 44), and divided ten major tasks including promoting overall development of old-age service facilities in town and developing community home old-age services into 40 specific tasks, among which 19 specific tasks had seen its detailed measures enacted by the end of 2014 while 7 specific tasks such as reform of five-grantees supporting system had not seen any detail measures by the middle of August, 2015.
(V) In Jiangxi Province, the elderly welfare service center project progressed slowly and RMB340 million of public welfare funds from lottery had been in idleness. In 2013 and 2014,the Finance Department of Jiangxi Province arranged RMB180 million and RMB160 million of welfare lottery public funds to be used in the early land costs and construction costs of the elderly welfare service center project respectively in Jiangxi Province. In February, 2015, Nanchang Municipal Government determined the allocated land for the project. But by the end of July 2015, because the Land Department had not issued land allocation decision, the project still had not got started, resulting in RMB340 million of lottery public funds being idle.
(VI) Wuxi County of Chongqing Province misappropriated some specific funds of elderly nursing houses reconstruction and extension in villages and towns to build social welfare center. After the center was established, part of the house was occupied by the County Civil Affairs Bureau to handle official businesses, and the rest of it had been idle for four years. In July, 2010, Wuxi County Civil Affairs Bureau began to build the county social welfare center. The center consisted of two main buildings and had a total area of 5951.41 square meters. The principal part of the project was completed in December of 2011. By the end of August, 2015, RMB11.9451 million investment had been completed and RMB7.4943 million project funds had been paid, among which RMB2.1353 million specific funds for nursing home reconstruction and extension had been misappropriated. In June 2013, the County Civil Affairs Bureau, with the approval of the county and the county government, moved to one building of the county social welfare center, which occupied an area of 3713.28 square meters; the other building has been idle for nearly four years till now.
(VII) Health and Family Planning Commission had not adequately strengthened supervision over the construction of rural doctors team. On March 6th, 2015, General Office of The State Council issued Opinions on Further Strengthening the Construction of Rural DoctorsTeam (General Office of the State Council [2015] No. 13), urging provinces to make specific implementation plans before the end of March in 2015 and to report those plans for records to Health Reform Department, Health and Family Planning Commission as well as other departments under the State Council. At the same time, provinces were required to establish supervision and reporting mechanisms to ensure the implementation of policies about constructions of rural doctor teams. By the 27th of August, 2015, only 8 provinces had issued and reported relevant practical measures to the Health and Family Planning Commission.