Shanghai will adopt a new financial management system for its
vast pile of social security funds, with the local branch of a
leading Chinese commercial bank taking on a management role,
sources with the municipal government announced Tuesday.
Independent supervision of money management will be a feature of
the new system, the sources said.
The Shanghai Branch of the Industrial and Commercial Bank of
China (ICBC) was recently chosen from among 13 candidates to manage
the project, according to officials.
Three separate accounts -- an income account, an expenditure
account and a special account -- will be opened at the local ICBC
branch and used to manage Shanghai's social security funds, bank
officials said.
The new system is a response to a corruption scandal that hit
headlines this summer, shocking the nation. Chen Liangyu, secretary
of the municipal committee of the Communist Party of China, and Zhu
Junyi, head of the municipal social security authorities, were
sacked for stealing money from the social security coffers. Qiu
Xiaohua, head of the State Bureau of Statistics, was also involved
in the case and has been removed from office.
On November 1, Shanghai promulgated regulations concerning the
financial management of social security funds, which stipulated the
setting up of independent income and expenditure accounts as well
as third-party supervision.
In the past, Shanghai's social security funds were managed
through a single income account. Local social security authorities
made decisions about revenue, withdrawal and payment of funds. This
made it relatively easy for some corrupt administrators to embezzle
money.
It is believed the new system will help ensure transparency in
the management and supervision of the social security funds.
According to the Ministry of Labor and Social Security, China is
considering formulating state regulations on social security
funds.
(Xinhua News Agency December 13, 2006)