China plans to raise the salaries of civil servants and employees of public
institutions as the government begins to reform the country's income
distribution system to narrow the gap between rich and poor.
A total of 34.7 billion yuan (US$4.3 billion) will be spent this year on
salary increases for 120 million people, including six million Central and local
government officials, 30 million employees of public institutions, and 50
million retired military servicemen and government employees.
In addition, the stipend standards for 30 million disabled military
servicemen and family members of war heroes and military servicemen and the
basic subsistence allowances for city dwellers will also be raised.
The salary reforms "will help create a sound environment for the reform on
income distribution system," said President Hu Jintao at a high-level meeting
discussing equal income distribution early this month. Hu added that the reform
is also necessary to build an efficient, transparent and honest government in
accordance with the Civil Servants Law which came into force in January,
stipulating a uniform salary system for civil servants across the country.
People working in remote, underdeveloped areas will also receive a special
allowance and performance-related pay.
The aim of the planned pay rise is to improve the welfare of government
employees in China's poor and rural regions, according to the Ministry of
Of the six million civil servants and 30 million personnel working in
publicly funded organizations across China, 60 percent work in county-level
governments, with salaries dependent on local government finances. Figures from
the Ministry of Personnel show that the income gap ratio between officials of
the same rank in Shanghai and the northwestern province of Shaanxi can be 2.8:1.
Except for nine prosperous regions including Beijing, Shanghai, and the
provinces of Shandong, Jiangsu and Fujian, the salary increases will be financed
by the Central Government.
"It is very important to offer government administrative staff effective
incentives to inspire more enthusiasm," said Liu Xin,a professor with the School
of Public Administration at the Beijing-based People's University of China.
He said that it was very difficult for grassroots civil servants to secure
pay increases by staying in the same position for years, while their workload
and pressure continue to build. "It has inevitably led to inefficiency and
turnover of competent civil servants who believe their income should match their
actual contribution," he said.
Statistics from the Ministry of Personnel showed that at least 1,039 civil
servants with bachelor's degrees had resigned from 21 Central Government
ministries between 1998 and 2002. In the Ministry of Foreign Affairs, most of
the officials who resigned were below the age of 35. A total of 123 people who
worked for the Ministry of Commerce for less than three years, 72.8 percent,
quit to join foreign companies, where income is based on performance.
The unfair income distribution system has prompted some officials to gain
personal wealth illegally.
Xie Zhengzheng, who works in the Beijing branch of a foreign investment bank,
is sceptical of the pay rises for civil servants since "their income is actually
far more than the cash they receive." He said: "It includes various welfare-like
assigned apartments and automobiles."
But the Ministry of Personnel insists the emphasis of the reform is to quash
these unofficial bonuses and curb excessively high salaries while increasing pay
for grassroots officials.