Auditor-General Li Jinhua yesterday said 1.4 billion yuan
(US$170 million) were misused out of the 2003 budget.
In his audit report, delivered to the Standing Committee of the
10th National People's Congress (NPC), Li said malpractice cases
were found in 41 out of the 55 central departments under
investigation.
Most of the money, originally allocated for specific purposes,
has gone into the hands of staff members or to office building
construction.
Li chose the General Administration of Sports as an example.
Since 1999, the sports administration misused 131 million
yuan?of funds from?China's?National
Olympic?Committee.
About 109 million yuan (US$13.2 million) of the fund was misused
to put up residential buildings for the staff of the sports
administration,?and the rest was invested into companies,
according to the audit report.
Misuse of funds for poverty alleviation was particularly serious
in more than 590 poverty-stricken counties that were examined by
the National Audit Office last year.
Li said most of the low-interest loans, which should have gone
into the pockets of farmers, was used for traffic, electrical power
and communication industries.
For instance, only 2.8 million yuan (US$340,000) in low-interest
loans in Southwest China's municipality of Chongqing was allocated
to farmers, accounting for merely 0.3 per cent of the total loans
to aid the poor.
As a result, many farmers could not get soft loans and had to
borrow money from rural credit co-operatives with an annual
interest of 6 per cent, said Li.
The National Audit Office also discovered several illegal
activities in sales of land-use rights in 10 cities around China
while farmers were not adequately compensated for land
expropriation.
For instance, a private company in Central China's Hubei
Province allegedly defrauded more than 18 million yuan (US$2.2
million) from the compensation funds by colluding with a local
township government.
And appropriation of farmland was rampant in some areas, such as
the Oriental University City Co Ltd illegally renting at least 380
hectares of farmland to build golf courses at the border of Beijing
and Hebei Province, said the report.
Li said the country's fiscal revenue last year topped 2 trillion
yuan (US$242 billion) for the first time, a rise of 14.9 per cent
year-on-year.
Although the figure gave officials reason to smile, the low
economic returns of government-invested projects have given them
some cause for concern, said Li.
He said a quarter of some 526 infrastructure projects nationwide
were not completed as scheduled, and 119 out of 320 selected
projects, although finished, cannot be put into full operation.
For instance, the construction of a gasworks in Central China's
Henan Province, with an investment of 2.3 billion yuan (US$278
million), started 16 years ago and finished in 2001.
The gas market has changed a lot during the 16 years but local
policy-makers failed to readjust the original plan according to the
developing situation.
As a result, the gasworks ran in the red since it went into
operation.
As to the tax collection circle, the audit office scrutinized
788 enterprises nationwide last year and found a total of 25.1
billion yuan (US$3 billion) were evaded in taxes between January
2002 and December 2003.
The tax bureau of Tangshan, a city in North China's Hebei
Province, unlawfully allowed 13 local iron firms to defer tax
payments of more than 1 billion yuan (US$121 million) since
November 2002.
So far, more than 70 local officials involved have received
punishments and two of them have been brought to the court.
(China Daily June 24, 2004)