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    Railway chief steams ahead with reforms
Fu Jing
2005-03-19 05:30

The Ministry of Railways took another swipe at bureaucracy on Friday when all of China's railway sub-administrations were swept away.

The clear-out is part of an on-going efficiency drive which will see the country's railway stations and sections come under the direct management of railway administrations.

Currently, there are 15 railway administrations under the ministry. According to the ministry's reform plan, the 10 administrations that had sub-administrations have eliminated all their 41 sub-administrations.

Beijing, Shanghai, Guangzhou and Wuhan will become four national railway pivots, announced Railways Minister Liu Zhijun.

Before the reform, the railway system had four levels of administration, namely, the ministry, administrations, sub- administrations, and stations and sections. Administrations and sub-administrations were both legal entities and their functions overlapped in some aspects, leading to low-efficient management, said Liu.

"Cancelling the sub-administrations is an inevitable step as we set up brandnew railway network management system in China," said Liu of the State-monopolized sector.

He said the sub-administrations will be replaced by representative offices of administrations. Surplus officers and staff will be sent to strengthen stations and railway sections.

"The reforms will not cause many laid-offs," said Liu.

However, Liu's ministry has admitted long-term redundancy in China's railway network management is a reality.

For one kilometre of track, China has 24 staff to maintain its operation.

Germany, however, needs only 7, Japan needs 5 and the US needs less than one staff to do a similar job.

But critics insisted Liu's plans for new three-level management hierarchy, which puts his ministry at the top, do not complement China's market-oriented reform.

"As a cabinet department, the role of the Ministry of Railways is supervising, instead of being involved in business operation," said Lin Yueqin, a researcher with the Institute of Economic Research under Chinese Academy of Social Sciences.

He suggested borrowing Russia's experience to form a national railway company, and allow the 15 administrations to become sub-companies.

"Then corporate governance can be improved if barriers to stop private and foreign capital to flow in the sector can be finally removed," said Lin. "Only competition and multiplied investment can change the current poor performance of China's railway sector,"he added.

(China Daily 03/19/2005 page2)


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