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Xinhua Insight: Parliament endorses cabinet reshuffle, unleashing China's reform vitality

BEIJING, March 14 (Xinhua) -- The National People's Congress (NPC), China's parliament, adopted a cabinet restructuring plan at a plenary meeting on Thursday in a bid to reduce bureaucracy and make the government more efficient in the world's most populous country.

The endorsement of the plan will reduce the number of ministries under the State Council from 27 to 25, with the dismantling of the bulky Ministry of Railways and mergers among several other government departments.

In overhauling the cabinet, the central government has emphasized that the most important tasks are transforming the government functions and reducing administrative intervention in the market and on social issues.

As the ruling Communist Party of China (CPC) proposed to deepen administrative reform at the 18th National Congress in November, the restructuring, which is the seventh of its kind since China kicked off its economic reform in the late 1970s, has been largely seen as the Party's commitment to honoring its reform promise and an overture to reforms in broader spheres.

The institutional restructuring is expected to create an efficient and law-based government with a clear division of power, reasonable distribution of labor and well-defined responsibilities.

The plan came amid complaints about the duplication of functions, overlapping management, low efficiency and bureaucracy -- issues that often lead to corruption and dereliction of duty among officials without proper supervision over administrative power.

According to the plan, the Ministry of Railways, which has long been at the center of controversy for being both a railway service provider and a railway industry watchdog, will be split into administrative and commercial units.

The status of the existing State Food and Drug Administration will be elevated to a ministerial-level general administration to give teeth to the watchdog in enhancing food and drug safety supervision, following a string of food safety scandals and mounting public dismay.

Observers believe the endorsement of the institutional reform plan reflects the new Party and state leaders' resolve to deepen reforms in more challenging areas at a critical juncture.

Since Xi Jinping replaced Hu Jintao as the general secretary of the CPC Central Committee in November, he has advocated reform on various occasions and used a number of new political phrases to consolidate reform consensus.

He came up with a particularly notable line while visiting Guangdong Province on the first leg of his inspection tour shortly after becoming the Party chief. "While advancing reforms, we must have the courage to gnaw at a hard bone and wade through a dangerous shoal," he urged.


State Councilor Ma Kai said the restructuring is aimed at transforming government functions, improving administrative efficiency, granting more power to the market and society and unleashing social dynamics, public creativity and enthusiasm for the building of a moderately prosperous society.

"Departments of the State Council are now focusing too much on micro issues. We should attend to our duties and must not meddle in what is not our business," Ma said on Sunday.

Chi Fulin, director of the China (Hainan) Institute for Reform and Development, said Chinese people are looking to the Party to seize the opportunity presented by the government transition to push forward comprehensive reforms.

Work reports from the State Council, which were submitted to nearly 3,000 NPC deputies for deliberation, outlined a slew of reform events this year.

According to another report submitted by the National Development and Reform Commission, the economic planner, an overall reform plan, road map and timetable will be mapped out this year, complete with a 2013 guideline on deepening reform in the economic system.

Reforms in the economic sphere are aimed at improving the operating budget management for state-owned capital, optimizing the business environment for the private economy, perfecting the pricing mechanisms for refined oil products, natural gas, thermal coal and railway cargo, as well as expanding trial programs for value-added, property and resources taxes.

To improve people's quality of life, reforms in medical care and medical aid, social security, household registration, education, culture, labor re-education system and the judiciary system have also been put high on the government's agenda.

"The complexity of the new round of reforms lies in adjusting power and containing vested interests," said Wang Changjiang, dean of the Party Building Department of the Party School of the CPC Central Committee.

"Without fearless courage to break down all barriers within the existing administrative mechanism, reformers will find it difficult to win the trust of the people," said Wang.


By staging gradual reform, China has seen its per capita gross domestic product rocket from a few hundred U.S. dollars in the late 1970s to 6,100 U.S. dollars last year.

It is now the world's second-largest economy, as well as the top exporter and top foreign reserve holder.

Beneath such economic glories, however, lie social ills such as environmental woes, food safety, corruption and an urban-rural gap in public services.

"These challenges can not be tackled through reform overnight," said Zhou Wenbin, an NPC deputy and president of Nanchang University in Jiangxi Province.

"We must be prepared to advance reforms as if we were fighting a protracted battle and seek to make breakthroughs in key areas when the time is ripe," he said.

To keep the country's reforms on a healthy trajectory that can ensure both social stability and steady economic expansion, China's top legislature has vowed to provide solid legislative support.

Lang Sheng, deputy director of the Legislative Affairs Commission of the NPC Standing Committee, said the NPC Standing Committee will prioritize its legislative work in the next five years according to the Party's reform agenda.

NPC deputy Zhang Dinglong, also an official with the Research Office of the State Council, said China's current reform target is to build an efficient and law-based government that can better safeguard social justice and fairness and unite all Chinese people in the goal of achieving national rejuvenation.

Given that the Chinese economy has become integrated with the world economy in an unprecedented way, the changing external environment shall weigh more on the country's reform decisions now than ever.

Without a worldwide perspective, for instance, researchers can hardly make globally competitive technical innovations to facilitate domestic economic restructuring or sharpen China's cutting edge in foreign trade.

At the legislative session, Chinese officials showed interest in borrowing foreign experiences to push ahead reforms.

Central banker Zhou Xiaochuan, for example, did not rule out the possibility of applying overseas financial instruments such as asset securitization and municipal bonds in addition to bank loans to finance China's urbanization drive.

But he also stressed that rules must be tweaked in line with domestic circumstances before a financial instrument is put to use.

Shanghai Mayor Yang Xiong, also an NPC deputy, said that with reforms being advanced in broader areas, wisdom matters more than ever.

First-rate reform must be based on thorough planning with minimized negative impacts, he said.

China has also shown its reformist spirit in diplomacy.

At a press conference on the sidelines of the parliamentary session, Foreign Minister Yang Jiechi called on the G20 summit to promote the reform of the international financial system, improve the multilateral trading system and boost growth and employment.

"China is an active participant...and willing to play a proper role to facilitate the building of a fair and rational international system," he said.

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