BEIJING -- Despite calls by the central government to curb rising real estate
prices, prevent worsening pollution, end frequent coal mines disasters and halt
official corruption, many local governments seem to be paying little more than
lip service to these urgent issues that are blocking the development of a more
The public and political analysts have been advocating a "vertical
integration" mechanism, or centralized management of public administration. The
idea would be to allow the ministries of the central government to have direct
control over their regional bureaus, many of which now take their orders from
A recent survey by China Youth Daily found that 85.9 percent of the Chinese
public favor this so-called "vertical integration" as a way of checking
corruption and dereliction of duty by local government officials.
Yet is this the panacea for a host of administrative problems? The case of
Zheng Xiaoyu, former head of the State Food and Drug Administration (SFDA),
might suggest otherwise.
Upon his appointment as head of the SFDA in 1998, Zheng initiated vertically
integrated management as he restructured the administration. The changes were
broad and seemed impressive. Technical standards were raised, lower-level
officials were approved by the head office to avoid cronyism and budget controls
were tightened. The changes made local SFDA bureaus subordinate to their higher
In 2002, the SFDA also adopted national standards in the certification of
medicines, replacing a mishmash of local standards. All new medicines had to
meet the same new standards before being approved for sale by the SFDA.
The new measures succeeded in preventing some profit-seeking local
governments from meddling in medicine approval. But something seems to have gone
terribly wrong at the highest levels.
The SFDA became so powerful while supervision of the power was weak. Many
fake and substandard medicines it had approved reached the market. Some drugs
ended up killing or harming people they were supposed to help.
Although details of Zheng's case have yet to be made public, the Central
Commission for Discipline Inspection of the Chinese Communist Party said earlier
this year "Zheng neglected his duty to supervise the drug market, abused the
administration's drug approval authority by taking bribes and turned a blind eye
to malpractice by relatives and subordinate officials."
It appears corruption at the national office of the SFDA was not isolated to
Zheng. Two of his former secretaries also took bribes and put public health at
risk. Hao Heping was sentenced to 15 years in prison for bribery last November
and Cao Wenzhuang has been under investigation since January last year.
A Ministry of Supervision report said the scandal at the SFDA "had a vile
effect...that threatened public health and tarnished the image of the Party and
the government." TOO MANY LOOPHOLES
Vice-premier Wu Yi told a national conference on food and drug safety on
Thursday that Zheng's case exposed at least five loopholes in the government's
drug industry management system:
-- Laws and regulations on drug supervision and management are incomplete,
and the government body has too much discretionary power to interpret existing
-- No effective supervision mechanism has been established to check the SFDA;
-- In their efforts to "help drug companies", SFDA officials became too cosy
with drug manufacturers and neglected their duty to safeguard public health;
-- The drug approval process is not democratic and not in line with
-- Appointments of lower-level officials are not made in line with democratic
Wu's words can be boiled down to one political dictum: absolute power
It matters not if the administration of government is vertically integrated
or horizontally managed. An effective system of checks on the use of power must
Without supervision, vertical integration simply narrows the number of
officials unscrupulous businesses need to bribe.