Full Text: Report on China's central, local budgets
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Content
I. Implementation of the Central and Local Budgets for 2010
II. Draft Central and Local Budgets for 2011
III. Managing Public Finance in Accordance with the Law
and Tightening Management to
Successfully Implement the 2011 Budgets
II. Draft Central and Local Budgets for 2011
1. Our country's present fiscal situation
The situation our country's development faces in 2011 is extremely complex. The world economy will continue to recover slowly, and the foundation for recovery is not solid. The positive trend of our country's economy has not changed, but we face numerous conflicts and problems. Fiscally, there is still a significant imbalance between our revenue and expenditures.
In terms of revenue, sustained steady and rapid economic development has laid a foundation for increasing revenue. At the same time, revenue will decrease somewhat because the revenue base figure for 2010 was relatively high; it will be difficult to maintain rapid growth in imports and exports; the automobile market is gradually cooling off; and we are implementing the reform of personal income tax, adjusting the scope of VAT and business taxes, and continuing to implement the preferential income tax policy for some small enterprises with low profit. Revenue will rise less in 2011 than in 2010.
In terms of expenditures, in order to complete ongoing government-funded projects and strengthen agricultural and water conservancy infrastructure, we must maintain a certain level of investment. In order to accelerate economic restructuring and the transformation of the pattern of development; move forward with reform in the key areas of education, medicine and health, and social security; effectively ensure and improve the people's wellbeing; respond to inflation pressure; and increase subsidies to people with low incomes, we must further increase government spending. All of this will put considerable pressure on expenditures.
2. General requirements for compiling budgets and public finance work
On the basis of the central leadership's decisions and arrangements and in light of the present economic and fiscal situations, we have adopted the following guiding thought for compiling the 2011 budgets and doing public finance work: We need to comprehensively implement the guiding principles of the Seventeenth National Party Congress and the Fifth Plenary Session of the Seventeenth CPC Central Committee; take Deng Xiaoping Theory and the important thought of Three Represents as our guide; thoroughly implement the Scientific Outlook on Development; unwaveringly take scientific development as the theme and accelerating the transformation of the pattern of economic development as the main thread; continue to implement a proactive fiscal policy; deepen reform of the fiscal and tax systems; make adjustments in the distribution of national income; optimize the structure of expenditures; increase support for agriculture, rural areas, and farmers, education, medical and health care, social security and employment, low-income housing projects, energy conservation and environmental protection as well as less developed areas; effectively ensure and improve the wellbeing of the people; and promote economic growth and restructuring, and balanced regional and overall urban and rural development. We will adhere to the policy of managing financial matters in accordance with the law, taking all factors into consideration when making overall plans, and increasing revenue and reducing expenditures; strengthen the scientific management of public finances; strictly limit regular expenditures; increase returns on the use of government funds; and promote steady and rapid economic growth and social harmony and stability.
On the basis of this guiding thought, we will continue to implement a proactive fiscal policy in 2011, which will primarily be manifested in the following ways.
First, raising the incomes of urban and rural residents, and expanding consumer demand. We will spur the adjustment of national income distribution, increase government subsidies, raise the basic income of low-income urban and rural residents, and increase consumption capacity. We will improve all policies that strengthen agriculture and benefit farmers; strive to expand employment; support the creation of a sound mechanism for regularly raising the salaries of enterprise employees; raise the level of pension benefits for enterprise retirees and subsistence subsidies for low-income urban and rural residents; and implement the policy of linking pay to performance for teachers in compulsory education and for employees of public health institutions and community-based medical and health care institutions. We will improve policies that help expand consumption, such as the policies of providing subsidies for rural residents to purchase home appliances and subsidies for trading in old home appliances for new ones.
Second, striving to optimize the investment structure, and strengthening weak links in economic and social development. Funds allocated for capital construction investment in the central government budget will be used mainly to support the construction of low-income housing projects and the development of agricultural infrastructure, particularly water conservancy, and education and health infrastructure; energy conservation, emissions reductions, ecological conservation and environmental protection; and economic and social development in Xinjiang, Tibet and Tibetan ethnic areas in Sichuan, Yunnan, Gansu and Qinghai provinces; innovation; and the development of strategic emerging industries. We will give priority to ensuring funding for key ongoing projects, and begin construction on the major projects in the Twelfth Five-Year Plan in an orderly manner. At the same time, we will further encourage and guide healthy development of nongovernmental investment.
Third, adjusting and improving tax policies, stimulating enterprise development and guiding consumer spending. We will continue to reform and improve the tax system, straighten up and standardize administrative charges and government-managed funds, make better use of the role of taxation in adjusting the economy and distributing income, and spur accelerated transformation of the pattern of economic development. We will launch pilot projects for reforming VAT, improve the system of sales taxes, implement reform of the personal income tax system in stages and press ahead with reform of resource taxes. We will continue to implement the preferential income tax policy for some small enterprises with low profits and support the development of small and medium-sized enterprises. We will implement preferential tax policies that are beneficial for conserving energy, reducing emissions, protecting the environment and creating new jobs.
Fourth, further optimizing the structure of government expenditures, and ensuring and improving the wellbeing of the people. We will increase expenditures in the key areas of agriculture, rural areas, and farmers; less developed areas; social programs; restructuring; and scientific and technological innovation. We will promote the improvement of the people's wellbeing and the development of all social undertakings, and ensure the masses receive more visible and tangible benefits. We will vigorously support the post-disaster rebuilding of Yushu and Zhugqu. We will reduce regular expenditures and genuinely lower administrative costs.
Fifth, vigorously supporting economic restructuring and balanced regional development, and spurring transformation of the pattern of economic development. We will increase support for scientific and technological innovation and give impetus to the industrial application of scientific and technological results. We will promote the development of strategic emerging industries, support the development of small and medium-sized enterprises and service industries, and actively move forward with industrial restructuring and with mergers, reorganizations and technological upgrading of enterprises. We will encourage and expand imports of key components and parts as well as advanced equipment, and introduce advanced technology. We will vigorously support energy conservation and emissions reductions, accelerate the creation of a mechanism to compensate for damage caused to the ecological environment, and comprehensively establish a mechanism for subsidizing and rewarding preservation of grassland ecological environments. We will increase general transfer payments from the central government to local governments; give more support to old revolutionary areas, ethnic areas, border areas and impoverished areas; and implement fiscal and tax policies to promote balanced regional development.
On the foundation of promoting steady and rapid economic development in 2011, we will concentrate our financial resources on a number of major issues to ensure and improve the wellbeing of the people: 1) We will comprehensively implement the requirements set forth in the National Medium- and Long-Term Plan for Education Reform and Development, increase education spending, and increase returns on the use of education funds. 2) We will energetically support reform of the pharmaceutical and healthcare systems and raise the level of medical services and medical insurance. 3) We will increase investment in low-income housing projects, and move forward with the construction of public rental housing and low-cost rental housing and the renovation of dangerous rural housing and all types of run-down areas. 4) We will support the accelerated establishment of a social security system that covers both urban and rural residents, further expand the scope of pilot projects in a new type of pension insurance for rural residents, and bring zero-income residents of cities and towns where pilot projects are underway into the insurance system. 5) We will strengthen agricultural and rural infrastructure; energetically carry out irrigation and water conservancy projects, harness small and medium-sized rivers, reinforce dangerous small reservoirs and prevent disasters from mountain torrents; and effectively improve working and living conditions in the countryside. 6) We will support energy conservation, emissions reductions and scientific and technological innovation; and spur economic restructuring and transformation of the pattern of economic development.
3. Public finance budgets for 2011
On the basis of the targets for economic development in 2011, economic and social policies, and the general requirements for compiling budgets decided upon at the Central Economic Work Conference, we have set the following major targets for 2011 public finance budgets: total revenue in the central budget should reach 4.586 trillion yuan, an increase of 8% over the actual figure for 2010 (here and below), and 150 billion yuan will be added from the central budget stabilization fund, bringing total revenue for 2011 to 4.736 trillion yuan. Expenditures in the central budget should total 5.436 trillion yuan, an increase of 12.5%. This consists of 1.705 trillion yuan incurred at the central level, an increase of 6.7%, and 3.731 trillion yuan paid out as tax rebates and transfer payments to local governments, an increase of 15.3%. Expenditures exceed revenue in the central budget, resulting in a deficit of 700 billion yuan, 150 billion yuan less than the actual figure for 2010. The limit for the outstanding balance of government bonds in the central budget stands at 7.770835 trillion yuan.
Figure 5
Budgetary Balance of the Central Government for 2011
Based on preliminary provisions for the local budgets as complied by the central government, revenue collected by local governments will amount to 4.386 trillion yuan, up 8%. Adding the 3.731 trillion yuan in tax rebates and transfer payments from the central government, local government revenue will total 8.117 trillion yuan. Local government spending will amount to 8.317 trillion yuan. Expenditures will exceed revenue by 200 billion yuan, and to compensate for this, the State Council has agreed for the Ministry of Finance to issue 200 billion yuan of local government bonds on behalf of local governments, and these will be incorporated into provincial-level government budgets. Arrangements for revenue and expenditures of local governments should be based on the budgets approved by the people's congresses at their respective levels.
Combining central and local budgets, national revenue will be 8.972 trillion yuan, an increase of 8%. Including the 150 billion yuan from the central budget stabilization fund, total available national revenue is projected to be 9.122 trillion yuan. Total national expenditures are budgeted at 10.022 trillion yuan, up 11.9%. Total expenditures will exceed total revenue by 900 billion yuan. The national budget deficit will be around 2% of GDP in 2011, down from 2.5% in 2010. These arrangements take into account the need to consolidate and develop the results in responding to the impact of the global financial crisis and to maintain steady and rapid economic development, and reflect the requirement to promote the sustainable development of public finance.
Overview of the central budget stabilization fund
The outstanding balance of the fund stood at 236.813 billion yuan at the end of 2010. After 150 billion yuan is transferred to the 2011 budget, 86.813 billion yuan will remain.
1) Main revenue items provided for in the central budget
Revenue from domestic VAT will amount to 1.757 trillion yuan, an increase of 10.5%. Revenue from domestic sales tax will amount to 650 billion yuan, an increase of 7.1%. Revenue from VAT and sales tax on imports will amount to 1.122 trillion yuan, up 7%. Revenue from customs duties will amount to 217 billion yuan, up 7%. Revenue from corporate income tax will amount to 838 billion yuan, up 7.5%. Revenue from personal income tax will amount to 312 billion yuan, an increase of 7.5%. Revenue from stamp tax on securities trading will amount to 55 billion yuan, up 4.2%. Export tax rebates will amount to 800.5 billion yuan, an increase of 9.2%, which will result in a decrease in revenue by the same amount. Revenue from vehicle purchase tax will amount to 192.7 billion yuan, an increase of 7.5%. Non-tax revenue will amount to 208 billion yuan, up 5.7%.
Figure 6
Central Government Revenue in 2011
2) Main expenditure items provided for in the central budget
The plans for expenditures call for further optimizing the spending structure and giving top priority to ensuring funding for work related to agriculture, rural areas, and farmers; improving the people's wellbeing; developing social undertakings; advancing economic restructuring; and deepening reform. The main expenditure items, consisting of central government spending and transfer payments to local governments, are arranged as follows.
(1) The appropriation for education spending is 296.357 billion yuan, an increase of 16.3%. This figure consists of 78.645 billion yuan of central government spending and 217.712 billion yuan in transfer payments to local governments. Three billion yuan in subsidies has been appropriated primarily to support the development of rural preschool education in the central and western regions and ethnic minority areas. We have appropriated 92.124 billion yuan to improve the mechanism to guarantee funding for rural compulsory education, raise the benchmark of public funding per student in rural primary and secondary schools, continue to implement the policy of exempting urban students in compulsory education from paying tuition and miscellaneous fees, and ensure that children of rural migrant workers have equal access to compulsory education in cities. We have appropriated 16.514 billion yuan to continue to carry out the plan to improve weak rural schools providing compulsory education. We have appropriated 13.4 billion yuan to strengthen the basic conditions for vocational education and implement the policy of exempting students in secondary vocational schools whose families have financial difficulties and students in such schools who are studying agriculture-related majors from paying tuition. We have appropriated 27.1 billion yuan in subsidies to improve the policy framework for providing financial aid to students from families with financial difficulties attending regular senior secondary schools, regular undergraduate institutions, and higher and secondary vocational schools. We have appropriated 71.725 billion yuan to implement Project 985 and Project 211, accelerate the building of top-class universities and academic disciplines, and develop innovation platforms in strong disciplines. We have appropriated 20 billion yuan to support efforts to raise per student appropriations for local universities and advance their development and reform. We will promote the development of special education and education in ethnic minority areas.
(2) The appropriation for science and technology spending is 194.413 billion yuan, an increase of 12.5%. This figure consists of 190.159 billion yuan of central government spending and 4.254 billion yuan in transfer payments to local governments. We have appropriated 43.5 billion yuan, up 44%, to speed up the implementation of major national science and technology projects. We have appropriated 25.719 billion yuan for basic research funds to increase investment in the State Natural Sciences Fund and improve the capabilities of key national laboratories and basic research institutes. We have appropriated 99.063 billion yuan for applied research funds primarily to support research on cutting-edge technologies, research for the public interest and research on major, generic and key technologies. We will expand pilot programs for independent R&D on major scientific equipment. We will give more guidance and support to strengthen regional innovation capabilities and give impetus to the transformation of scientific and technological results into actual productive forces.
(3) The appropriation for spending on culture, sports, and media is 37.443 billion yuan, up 18.5%. This figure consists of 18.84 billion yuan of central government spending and 18.603 billion yuan in transfer payments to local governments. Priority will be given to supporting cultural development projects that affect the vital interests of people in rural areas and at the primary level. We will guarantee free admission to non-profit cultural facilities such as museums and memorial halls. We will strengthen protection of key national artifacts and major cultural and historical sites. We will actively promote cultural restructuring and the development of cultural programs and the culture industry. We will strengthen the international broadcasting capability of the news media.
(4) The appropriation for medical and health care spending is 172.758 billion yuan, an increase of 16.3%. This figure consists of 6.356 billion yuan of central government spending and 166.402 billion yuan in transfer payments to local governments. Together with the 127.321 billion yuan appropriation in 2009 and the 148.535 billion yuan appropriation in 2010, this completes the three-year plan for new spending from the central budget to support the deepening of pharmaceutical and health care reform. The central government has appropriated 76 billion yuan, up 35.7%, to raise the participation of eligible individuals in basic medical insurance for urban workers, basic medical insurance for urban residents and the new rural cooperative medical insurance to over 90%, and to raise the subsidy for the new rural cooperative medical insurance and basic medical insurance for urban residents from 120 yuan to 200 yuan per person. We will support the full implementation of the national system of basic drugs at government-run community-based medical and health care institutions and carry out comprehensive reform of community-based medical and health care institutions. We have appropriated 34.6 billion yuan to raise per capita spending on basic public health services for urban and rural residents from 15 yuan to 25 yuan, and continue to support the implementation of major public health service projects. We will carry out trial reforms of public hospitals. We have appropriated 8 billion yuan to increase medical assistance in both urban and rural areas.
(5) The appropriation for social security and employment spending is 441.434 billion yuan, an increase of 16.6%. This figure consists of 48.479 billion yuan of central government spending and 392.955 billion yuan in transfer payments to local governments. We have appropriated 13.1 billion yuan in subsidies to support the expansion of trials of the new rural pension insurance from around 24% of counties to 40% and extend pension insurance coverage to zero-income urban residents. We have appropriated 10.4 billion yuan to provide living allowances in one lump sum to more than 86 million urban and rural recipients of subsistence allowances and childless and infirm rural residents receiving guarantees of food, clothing, medical care, housing and burial expenses. We have appropriated 179.6 billion yuan in subsidies to basic pension insurance funds of enterprises, up 15.1%, to increase the per person monthly pension of enterprise retirees by about 140 yuan, improve the overall planning system for basic pension insurance funds of enterprise employees at the provincial level, and properly solve the problem of basic pension insurance for retirees of collectively owned enterprises that do not participate in the pension insurance scheme. The central government has appropriated 74.9 billion yuan, up 18.3%, to raise urban and rural subsistence allowances. We have appropriated 25.77 billion yuan in subsidies, up 19.5%, to raise benefits for entitled groups. We have appropriated 3.6 billion yuan to raise subsistence allowances for orphans by an appropriate amount. We have appropriated 10.65 billion yuan to help people affected by natural disasters to restore their lives. We have appropriated 6 billion yuan in subsidies to continue to deal well with the aftermath of policy-based closures and bankruptcies of SOEs. We will expand the policy of giving encouragement and support to people who start their own businesses, and we will do a good job in employment assistance and providing training in vocational and start-up skills.
(6) The appropriation for guaranteeing adequate housing is 129.266 billion yuan, up 14.8%. This figure consists of 29.163 billion yuan of central government spending and 100.103 billion yuan in transfer payments to local governments. By means of increasing government investment at all levels and actively guiding the participation of nongovernmental capital, we will accelerate the construction of public rental housing and low-rent housing; carry out renovations of run-down areas in cities, industrial and mining areas, forest regions, land reclamation zones and coalmines, and dilapidated rural homes; and build permanent housing for nomads. The central government has appropriated 103 billion yuan for low-income housing projects, up 34.7%. We have appropriated 26.266 billion yuan for the housing accumulation fund for employees in administrative agencies and institutions.
(7) The appropriation for spending on agriculture, forestry, and water conservancy is 458.883 billion yuan, an increase of 18.3%. This figure consists of 42.419 billion yuan of central government spending and 416.464 billion yuan in transfer payments to local governments. We have appropriated 157.54 billion yuan to strengthen agricultural and rural infrastructure with a focus on water conservancy; vigorously support harnessing small and medium-sized rivers, reinforcing dangerously defective small reservoirs, and preventing and controlling geological disasters such as mountain torrents; increase the number of designated counties where small irrigation and water conservancy facilities will be built and expand the scope of key national water and soil conservation projects; and advance the upgrading of water-saving equipment in large and medium-sized irrigated areas and of rural power grids. We have appropriated 86 billion yuan in general subsidies for purchasing agricultural supplies, up 20.1%. We have appropriated 22 billion yuan to improve the system of subsidies for purchasing superior crop varieties and to increase such subsidies. We have appropriated 17.5 billion yuan to scale up the subsidies for purchasing agricultural machinery. We have appropriated 9 billion yuan to promote the development of modern agriculture and agricultural sectors with particular strengths or unique features. We have appropriated 23 billion yuan, up 19.8%, for overall agricultural development to quickly increase the national grain output by 50 million tons, improve average- and poor-yield farmland, develop high-yield farmland, promote industrialized agricultural operations, and raise overall agricultural production capacity, with the focus on main grain-producing areas. We have appropriated 13.66 billion yuan to put in place a subsidy and award mechanism for the protection of grassland ecology. We have appropriated 30.6 billion yuan, up 17.7%, to support poverty-alleviation work in contiguous poverty-stricken areas with special features and develop industries with unique features or particular strengths in poverty-stricken areas. We have appropriated 9.406 billion yuan to improve the policy of subsidies to help pay agricultural insurance policy premiums. We have appropriated 16 billion yuan, up 55.8%, to comprehensively implement government awards and subsidies for village-level public works projects, the launching of which is determined by villagers themselves. We will comprehensively sort out and pay off debts incurred from providing compulsory education in rural areas and continue to carry out trials of sorting out and paying off other public welfare debts in rural areas.
(8) The appropriation for spending on land, resources, and meteorology is 45.489 billion yuan, an increase of 22.9%. This rather large increase is due to the large anticipated increase in revenue from use fees for mineral prospecting and mining rights and from mineral resource compensation fees, which are required by relevant regulations to be used exclusively for exploiting and utilizing mineral resources. This figure consists of 16.748 billion yuan of central government spending and 28.741 billion yuan in transfer payments to local governments. We will intensify exploration for mineral resources, restoration of the geological environment around mines, and conservation and comprehensive use of mineral resources, and support oversight and protection of the use of territorial waters.
(9) The appropriation for spending on energy conservation and environmental protection is 159.185 billion yuan, an increase of 10.3%. This figure consists of 7.437 billion yuan of central government spending and 151.748 billion yuan in transfer payments to local governments. We have appropriated 94.5 billion yuan for energy conservation and emissions reductions to strengthen the development of key energy-conserving projects; promote cleaner production, the retrofitting of energy-conserving technology and the development of energy-conserving industries; continue to support the work of retiring backward production facilities; make buildings more energy-efficient; further intensify the implementation of the project of promoting energy-saving products to benefit the people; expand the scope of subsidies for purchasing energy-saving and alternative-fuel vehicles; strengthen heavy metal pollution treatment and comprehensive ecological treatment in key areas and rivers; and comprehensively improve the rural environment. We have appropriated 12.2 billion yuan to support the implementation of the Golden Sun Project, use biomass energy more comprehensively, carry out demonstrations on the use of renewable energy in buildings, and encourage enterprises to develop circular production and to re-manufacture and re-use materials. We have appropriated 14.084 billion yuan, up 120%, to give impetus to the implementation of the second phase of the natural forest resources protection project. We have appropriated 32.7 billion yuan to support the implementation of major ecological restoration projects and consolidation of achievements made in returning farmland to forests. We will encourage imports of important energy resources, natural resources and raw materials and strictly control exports of resource products and products whose production is energy-intensive and highly polluting. We will promote the dissemination of research on low-carbon technology in key areas, and support the implementation of the National Climate Change Program.
(10) The appropriation for spending on transportation and transport is 286.691 billion yuan, up 10.3%. This figure consists of 40.024 billion yuan of central government spending and 246.667 billion yuan in transfer payments to local governments. We have appropriated 196.64 billion yuan to build rural roads, national and provincial trunk highways, and other public transportation infrastructure. We have appropriated 29.647 billion yuan to continue to provide fuel subsidies for urban and rural public transport and some other public service industries. We have appropriated 26 billion yuan for subsidies to local governments to phase out tolls on government-financed Grade II highways.
(11) The appropriation for spending on resource exploration, electricity, and information is 74.486 billion yuan, down 10%. This reduction is largely because of less spending on capital construction. This figure consists of 41.088 billion yuan of central government spending and 33.398 billion yuan in transfer payments to local governments. We have appropriated 38.1 billion yuan for the construction of infrastructure for resource exploration, electricity, and information. We have appropriated 3.5 billion yuan in special funds to support R&D and demonstration in strategic emerging industries. We have appropriated 10.344 billion yuan exclusively to promote the development of all kinds of small and medium-sized enterprises.
(12) The appropriation for spending on stockpiling grain, edible oils, and other commodities is 113.05 billion yuan, up 23.9%. This figure consists of 79.628 billion yuan of central government spending and 33.422 billion yuan in transfer payments to local governments. We have appropriated 29.3 billion yuan to eliminate local contributions to grain risk funds in major grain-producing areas and increase central government subsidies. We have appropriated 70.387 billion yuan to support steadily raising the floor prices of wheat and rice and increase reserves of grain, edible oils, petroleum, nonferrous metals, and other important commodities.
(13) The appropriation for spending on the commercial services industry is 70.614 billion yuan, an increase of 3.3%. This figure consists of 2.466 billion yuan of central government spending and 68.148 billion yuan in transfer payments to local governments. We have appropriated 42.6 billion yuan in subsidies to improve the policies to encourage the sale of home appliances in rural areas and the trading in of old home appliances for new ones. We have appropriated 9.4 billion yuan to continue to build a modern logistics network in the new countryside and promote the development of the logistics services industry.
(14) The appropriation for national defense spending is 583.591 billion yuan, an increase of 12.6%. This figure consists of 582.956 billion yuan of central government spending and 635 million yuan in transfer payments to local governments. These funds will be used mainly to modernize the army and improve the living conditions of officers and enlisted personnel.
(15) The appropriation for public security spending is 161.732 billion yuan, an increase of 9.6%. This figure consists of 102.453 billion yuan of central government spending and 59.279 billion yuan in transfer payments to local governments. We will continue to reform the funding system for procuratorial, judicial, and public security departments and improve the equipment of primary-level procuratorial, judicial, and public security departments and their ability to handle cases.
(16) The appropriation for general public service spending is 111.884 billion yuan, up 4.3%. We will strictly control regular expenditures. Spending on official overseas visits, purchases and the use of vehicles, and official entertainment shall not exceed the reduced allowance for 2009. The above figure consists of 87.685 billion yuan of central government spending and 24.199 billion yuan in transfer payments to local governments.
(17) The appropriation for payment of interest on government bonds is 183.984 billion yuan, an increase of 21.7%.
Consolidating the above expenditures shows that in 2011, the central government will spend a total of 1.050992 trillion yuan, an increase of 18.1%, in areas that directly affect people's lives, namely education, medical and health care, social security and employment, guaranteeing adequate housing, and culture. Expenditures on agriculture and water conservancy, transportation and transport, and environmental protection are all closely related to the people's wellbeing, and most of the tax rebates and general transfer payments from the central government to local governments will also be used to ensure and improve the people's wellbeing. Expenditures on the people's wellbeing will account for around two thirds of central government expenditures. The central government has appropriated a total of 988.45 billion yuan, up 15.2%, to benefit agriculture, rural areas, and farmers. This figure consists of 393.87 billion yuan for agricultural production; 140.6 billion yuan in direct subsidies to grain growers, general subsidies for purchasing agricultural supplies, and subsidies for purchasing superior crop varieties and agricultural machinery; 396.36 billion yuan to support the development of rural education, health care, and other social undertakings; and 57.62 billion yuan for expenses incurred through stockpiling agricultural products and associated interest payments. We have appropriated a total of 382.6 billion yuan for central government investment in capital construction.
3) Central government spending on tax rebates and transfer payments to local governments
We will further improve the structure of transfer payments. Central government expenditures on tax rebates and transfer payments to local governments in 2011 will amount to 3.731 trillion yuan, an increase of 15.3%. This figure consists of 506.799 billion yuan in tax rebates, an increase of 1.4%; 1.733677 trillion yuan in general transfer payments, up 18.5%; and 1.490524 trillion yuan in special transfer payments, an increase of 17.1%. General transfer payments for making access to basic public services more equal will amount to 660.911 billion yuan, up 21.2%. This figure includes 77.5 billion yuan in awards and subsidies to county-level governments to ensure their basic funding and improve their ability to provide basic public services, and 30 billion yuan to strengthen public finance guarantees for functional ecological zones such as the Sanjiangyuan functional ecological zone around the sources of the Yangtze, Yellow, and Lancang rivers. A total of 37 billion yuan in transfer payments has been appropriated to support leapfrog development in Tibet, Xinjiang, and other ethnic minority areas. A total of 13.5 billion yuan in transfer payments has been appropriated to continue helping cities formerly dependent on now-depleted mineral resources. A total of 58.1 billion yuan in transfer payments has been appropriated for the reform of taxes and fees on refined petroleum products.
Figure 7
Central Government Expenditures in 2011
4. Budget for central government-managed funds
In 2011, budgetary revenue from central government-managed funds will total 282.627 billion yuan, down 11%. This figure includes 64.8 billion yuan from the railroad construction fund, 12.393 billion yuan from port development fees, 14.732 billion yuan from civilian airport administration and development fees, 26.15 billion yuan from lottery ticket proceeds, 19.811 billion yuan from the fund for providing ongoing aid to residents relocated to make way for the construction of large and medium-sized reservoirs, and 9.601 billion yuan from the central government fund for repaying rural power grid loans. Adding the 79.016 billion yuan in revenue carried forward from last year, overall revenue from central government-managed funds will be 361.643 billion yuan.
Budgetary expenditures from central government-managed funds will be 361.643 billon yuan, an increase of 19.9%. This total consists of two parts. The first is 238.493 billion yuan of central government spending, an increase of 4.4%. This includes 68.292 billion yuan for building railroads; 10.171 billion yuan for developing ports; 8.777 billion yuan for civilian airport administration and development; 24.402 billion yuan of lottery ticket proceeds used to finance social welfare, sports, education, and other public welfare programs; 47 million yuan for providing ongoing aid to residents relocated to make way for the construction of large and medium-sized reservoirs; and 10.595 billion yuan for repaying rural power grid loans through the central government fund. The second part is 123.15 billion yuan in transfer payments to local governments, an increase of 68.1%.
Revenue collected by local government-managed funds whose budgets are complied by the central government will reach 2.299547 trillion yuan, down 29.5%. This decrease is mainly due to the expectation of less revenue from land-related government-managed funds. This figure includes 1.975341 trillion yuan of revenue from the sale of state-owned land-use rights; 44.667 billion yuan from urban infrastructure construction fees; 26.15 billion yuan in lottery ticket proceeds; and 27.413 billon yuan from local education surcharges. Adding the 123.15 billion yuan in central government transfer payments to local governments, revenue from local government-managed funds will be 2.422697 trillion yuan.
Expenditures from local government-managed funds will be 2.422697 trillion yuan, down 20%. This total includes 2.033957 trillion yuan of proceeds from the sale of state-owned land-use rights to be spent on compensation for land expropriation, housing demolition and resident relocation and also on urban development; 35.14 billion yuan from lottery ticket proceeds to be used to finance social welfare, sports, education, and other public welfare programs; 44.667 billion yuan for finishing urban infrastructure projects; and an additional 27.413 billion yuan for local education.
Combined revenue from funds managed by central and local governments will reach 2.582174 trillion yuan, down 27.8%. Including the 79.016 billion yuan in revenue carried forward from last year, available revenue from government-managed funds will total 2.66119 trillion yuan. Expenditures from these funds will total 2.66119 trillion yuan, down 18.3%.
5. Budget for central government's state capital operations
In 2011, in addition to the enterprises originally included in the budget for the central government's state capital operations, the budget will also include enterprises affiliated to the Ministry of Education and the China Council for the Promotion of International Trade; enterprises directly under the Ministry of Agriculture, the Ministry of Culture, and the State Administration of Radio, Film and Television; the China Publishing Group; and the China Arts and Entertainment Group, and the proportion of profits from state capital operations of central government enterprises collected by the central government will be raised by an appropriate amount. Budgetary revenue from state capital operations of central government enterprises will reach 84.439 billion yuan, an increase of 51.1%. Adding the 1.417 billion yuan carried forward from 2010, available expenditures will be 85.856 billion yuan. This sum has been allocated as follows: 49.55 billion yuan for restructuring the state sector of the economy and industrial restructuring, 3.05 billion yuan in subsidies for reforming unprofitable central government enterprises and making them profitable, 3.5 billion yuan for making major scientific and technological innovations, 3.5 billion yuan for major energy conservation and emissions reductions projects, 3 billion yuan in overseas investment, 1 billion yuan for strengthening workplace safety, 8 billion yuan for mergers and reorganizations, 4.5 billion yuan for developing emerging industries, 5 billion yuan for replenishing the country's social security funds, 500 million yuan for social security and related undertakings, and 4 billion yuan transferred to the public finance budget to be spent to improve the people's wellbeing. As the budgetary system of state capital operations improves, we will gradually increase spending on social security and other programs to improve the people's wellbeing. We will also actively push local governments to accelerate their trials of compiling budgets for state capital operations.
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