A senior Chinese legislator has urged the government to use the
extra fiscal revenue beyond this year's budget to finance public
services, improve people's livelihood and reduce the fiscal
deficit.
"The government must make a special budget for these extra money
ranging from 700 billion (about US$95 billion) to 800 billion yuan
and implement it upon the legislature's approval, " said Jiang
Zhenghua, deputy chairman of the National People's Congress
Standing Committee.
The government could take advantage of drastic rises in fiscal
revenue to increase the capital input in public services such as
social securities, reemployment, medicare, sanitation and housing
subsidies and bankroll primary education in rural areas, Jiang was
quoted as saying by Monday's China Securities Journal.
Jia Kang, director of the Research Institute for Fiscal Science
under the Ministry of Finance, predicted earlier this month that
this year's fiscal revenue might reach 5.1 trillion yuan, up 1.2
trillion, or 31 percent over the previous year.
The 2007 fiscal revenue was budgeted at 4.4 trillion yuan (about
US$598 billion) compared with an expenditure of 4.65 trillion yuan
(about US$631 billion).
The government has adopted a prudent fiscal policy since 2003,
with the country's fiscal deficit rate continuously falling from
2.9 percent in 2003 to nearly 1.1 percent this year. Meanwhile, the
country's national fiscal revenue more than doubled from two
trillion yuan in 2003 to four trillion yuan in 2006.
This year, the central government channeled 31.276 billion yuan
into health expenditures, up 86.8 percent over the previous year. A
new rural cooperative medical insurance system, aimed at helping
farmers fund visits to the doctor, will expand to more than 80
percent of the nation's counties.
In addition, the government put 223.5 billion yuan into
compulsory education in the rural areas this year, up 39.5 percent
from last year. All children will be entitled to 9-year free
compulsory education in rural China by the end of 2007.
The Chinese Ministry of Finance (MOF) decided to issue 1.55
trillion yuan of special T-bond this June, but officials with MOF
said the issue did not mean an increase in fiscal deficit because
the money would be used for the funding of the China Investment
Corporation, aimed at increasing revenue.
"More promising large-scale enterprises will be encouraged to
list on the capital market," Jiang, the deputy chairman. He added,
" The capital market system construction will be advanced and the
financial channels of enterprises will be expanded to prevent big
fluctuations in the stock market."
(Xinhua News Agency December 18, 2007)