Full text: Report on China's central, local budgets (8)

Third, we will strengthen efforts to make use of available government funds, and use funds more effectively. We will act in line with the requirements of the new Budget Law to develop an accurate picture of carryover and surplus funds, and in putting these funds to use we will favor areas such as public services, infrastructure, and improving quality of life. We will review special fiscal accounts, set ceilings for working capital in the budgets and budget stabilization funds, and carry out fiscal planning on a rolling basis for the next three years to prevent new funds from becoming idle.

Fourth, we will keep government investments at a certain scale, and make good use of the guiding role of such investments. This year the central government will earmark 477.6 billion yuan for investment in infrastructure, which is 20 billion yuan more than the previous year. The orientation of government investment will be adjusted and improved, with funds being used primarily for major state projects, trans-regional and cross-watershed investment projects, and major projects with strong externalities. We will further reduce investment in competitive areas and on subsidizing small and miscellaneous local projects.

Major spending policies are as follows:

Education

We will carry out the second phase of the action plan for preschool education. Our focus will continue to be on poor areas and schools that are badly built and poorly operated, and support and guidance will be given to local governments to encourage them to increase input into efforts to develop primary and secondary boarding schools in poor rural areas, expand and renovate schools in counties and townships to help them cope with increasing class sizes as more and more students from villages attend these schools, and improve facilities for primary and secondary school students, all with the aim of improving the basic conditions of badly built and poorly operated schools for compulsory education. We will implement the system of government financial aid policies. We will raise the annual government grants for students in secondary vocational schools and regular senior high schools from 1,500 yuan to 2,000 yuan per student. We will continue to implement the quality improvement plan for modern vocational education, and guide and incentivize local governments to step up the pace of work to improve their systems for allocating funds to vocational colleges based on student numbers. In this regard, awards and subsidies will be given to local governments from the central budget based on an evaluation of their respective progress in developing such a system, contribution of financial resources, reform and development in vocational education, and other factors. We will reform and improve the funding mechanisms for institutions of higher learning under the central government so that the cost of education can be shared between the government and students in a reasonable way; and we will encourage these institutions to embrace an internal quality building model of development and cultivate innovative students. We will support the development of local universities and colleges, pushing them to improve quality and helping them bring out their own distinct features. Impetus will be given to international exchange and cooperation in education.

Science and technology

We will put into practice the strategy of innovation-driven development. We will deepen reform in the management of science and technology initiatives (projects and funds) financed by the central government, taking proactive steps to optimize and integrate all types of science and technology initiatives, establishing an open and unified national science and technology management platform, and developing comprehensive, integrated methods for planning and implementing initiatives. We will improve and strengthen the management of research programs and their funding. We will expand the scale of the national seed fund for the application of scientific and technological advances and attract more nongovernmental funds and financial capital to support application. We will establish a national seed fund for investment in business start-ups in emerging industries, offering financial support primarily to innovative enterprises in emerging industries which are still in the embryonic stage, thus generating impetus for new businesses, innovation, and the upgrading of industry by pooling government, nongovernment, and private funds. We will promote the open sharing of scientific and technological resources by establishing a mechanism of subsidizing operators of major national facilities for scientific research and large or costly research apparatus who allow public access to their facilities. We will improve the funding mechanism for research institutes at the central level. We will increase spending on basic research and support efforts that raise our ability to make original innovations. We will give financial support to speed up progress in major national science and technology initiatives. We will improve government procurement policies and measures that support innovation and increase procurement of innovative products. Trials will be launched to test a compensation mechanism for insuring major newly developed technological equipment.

Social security and employment

We will keep to the rate of 10% in raising basic pension benefits for enterprise retirees. In reforming and improving the basic pension system for workers, we will focus on actuarial balance, combining contributions from different sources with funds in personal accounts, so as to close loopholes in the system and strengthen the supporting capacity of the insurance fund.

A basic pension system for the employees of Party and government offices and public institutions will be established, in which the contribution from the employer is equivalent to 20% of the employee's total salary and the individual contribution is equivalent to 8% of the base figure of the employee's salary. An occupational annuity system will also be established, in which the contribution from the employer is equivalent to 8% of an employee's total salary and the individual contribution is equivalent to 4% of the base figure of the employee's salary. Adjustments will be made to the salaries of employees in government bodies and public institutions. For public servants at the county level or lower, a salary system based on both position and rank will be implemented. We will complete work on standardizing allowances and subsidies for public servants and introducing performance-based pay in public institutions, and conduct research on the establishment of a system of additional allowances for certain areas.

We will increase support for financial aid and living subsidies to people facing serious difficulties to ensure that they have access to basic necessities, implement the temporary assistance system nationwide, and make sure work related to the subsistence allowances for both urban and rural residents is done properly. Adjustments will be made to subsidies and living allowances for entitled groups when appropriate.

We will optimize the mix of expenditures on employment. We will implement the initiative for promoting employment for university graduates and the scheme for guiding university students in starting new businesses, and give priority to work related to the employment of groups in more difficult circumstances, including migrant workers. We will put into effect and improve the policy of providing subsidies from the unemployment insurance fund to enterprises which maintain stable employee numbers during structural adjustments, and reduce the contributions of enterprises to the unemployment insurance fund. We will strengthen the government's capacity for providing public employment services. (Mo