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Premier demands licensing reforms
( 2004-01-07 00:08) (China Daily by Meng Yan)

Premier Wen Jiabao yesterday urged the nation's government officials to be well prepared for the enforcement of Law on Administrative Licensing.

Administrative licensing, referring to formal legal permission to conduct business or business-related activities, is a major governmental function exercised by governments at all levels.

Wen said the officials should take enforcement of this law as an opportunity to step up the transformation of government functions and push for management innovations.

The law, approved by the nation's top legislature in August of last year, will take effect on July 1.

Wen said the government should improve its methods of economic adjustments and market supervision.

He urged government officials to pay more attention to social service management and public service, and to provide more public resources to those areas.

He also demanded that governments release their policies and procedures to the public in a way that allows people to view public service as transparent, open and efficient.

The premier spoke at a conference on how to implement the law on administrative licensing attended by senior officials from all provinces, autonomous regions and municipalities.

He said government functions should be strictly separated from enterprise management.

He called on further clarifications in the relationships between government and enterprises, markets and society, and said the market should play a fundamental role to its fullest capacity in resources allocation.

"That is one of the most important tenets of this legislation,'' said Yu An, a professor of administrative law at Tsinghua University Public Administration School.

Yu said enforcement will be a "serious, thorough and institutional revolution'' for the administrative body for their major interests are at stake in this process.

The premier also urged senior officials to push for reforms of administrative permission and slash unnecessary administrative licensing items. The list has expanded so much over the years it has seriously hampered China's efforts to build a market economy.

The law requires all governmental bodies to straighten out existing items before July 1. Licensing items that do not fit within the law should stop being enforced.

Some governmental offices will be dissolved if their functions lose a foothold in the clean-up process, and employees will be dismissed.

There are some 4,100 items that require licensing in the country, according to sources with the Legal Affairs Commission of the NPC Standing Committee.

Overuse of licensing is a hotbed for corruption because it creates more opportunities for kickbacks, said Ying Songnian, professor and director of the Division of Law of the National School of Administration.

Over-elaborate procedures, poor efficiency, and underground, unfair or imprecise conditions for granting licences also stand out, he added.

An extreme case is the offices that were set up in Zhengzhou, a city in Central China's Henan Province, in 1998, to centralize the management of the local production of mantou, or steamed bread, the most loved staple food of local residents.

The offices controlled the licensing for every business related to steamed bread production, from flour mills to steamed bread makers. They had the power to issue or retrieve the licenses for mills that supply flour to steamed bread makers, while steamed bread makers who purchase flours from unlicensed millers would have their own licenses revoked.

The State Council began a nationwide campaign to rectify the situation in 2001. State Council commissions and ministries have given up the right to administer more than 1,000 licensing rights and have handed 82 items over to industrial associations and other intermediary agencies.

The premier said training should be enhanced among the officials to help them better understand the law and therefore better enforce it.

Vice-governors and senior officials in charge of legal affairs in all provinces, autonomous regions and municipalities will attend a week-long training programme at the National School of Administration in Beijing after the conference.

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