'Sleeping money' in govt coffers can improve economic structure

An employee counts renminbi (yuan) banknotes at a bank in Lianyungang city, East China's Jiangsu province, June 4, 2014.[Photo/IC]

According to a recent report from the Ministry of Finance, the national revenue for May was 1.44 trillion yuan ($230 billion), 3.2 percent lower than last month. The declining revenue casts heavy pressure on economic growth, while trillions of yuan lie "asleep" in the national coffers without being used. Comments:

There are two ways of "waking up" the "sleeping" money, namely by increasing public expenditure and cutting tax. Of the two, the latter seems better because with more money in their hands people tend to spend more, which in turn boosts economic growth and eases the pressure on the economy. It is time the central leadership considered cutting tax.

Li Muzhi, a researcher at the SIFL Institute, June 16

One of the main causes of public money lying "asleep" is that local governments have little discretionary power to decide how to use it; they have to follow the directives of the central government. Hence, more power should be delegated to local governments so they have more freedom in deciding how to use the money in their public accounts. Of course, it is also necessary to regulate local governments' power, to prevent them from misusing the money.

Kuang Xianming, a senior economic researcher at the China Institute for Reform and Development, June 16

Many analysts call for "waking up" the "sleeping" money and their main reason is to stabilize economic growth. It is important to use the money that is "woken up" to optimize the economic structure too, by selectively investing in the sectors that do the least damage to the environment and have room for development.

ce.cn, June 13

The problem of public funds "lying asleep" first emerged in 2013, months after the central leadership launched its anti-graft campaign. Various levels of officials were keen to spend public funds on economic growth programs in the past because they could profit from them through corruption. But as the anti-graft campaign has curbed corruption, they have lost their enthusiasm for local development. It is necessary to improve the regulations so that not only corrupt officials, but also lazy ones pay for their improper deeds or lack of action.

hebeinews.cn, June 12

(China Daily 06/17/2015 page8)