China has unveiled an ambitious plan to revamp its central government structure, with more than two dozen ministries and organisations affected.
The sweeping changes include the merger of the country’s banking and insurance regulators, and the setting up of special agencies to oversee issues related to immigration and military veterans.
As a result, the number of ministries under the State Council, China’s cabinet, will be reduced by eight to 26, while seven non-ministerial agencies will also be cut.
The plan, which is expected to be endorsed by the National People’s Congress later this week, marks one of the biggest changes to the central government in the history of the People’s Republic of China. The last such reshuffle of a similar scale happened in 1998 when then Premier Zhu Rongji closed or merged 15 ministries and commissions under the State Council.
Despite the breadth of the plan, changes rumoured to have been happening to the Hong Kong and Macau Affairs Office proved to be unfounded, while an anticipated Ministry of Energy also failed to appear.
The power of the influential National Development and Reform Commission – often dubbed the little State Council – will be reduced under the new plan.
The move is part of President Xi Jinping’s plan to retool the entire administration to give the ruling Communist Party greater control and a more effective platform to govern the world’s most populous nation.
It is also intended to cut bureaucracy and turf wars by removing overlapping duties and responsibilities.
The creation of a Ministry of Emergency Management, for instance, will centralise the administration of all natural and man-made disasters, from earthquakes to forest fires. Under the current, disjointed system, the nature of the incident defines which government agency deals with it. For example, forest fires come under the auspices of the forestry administration, but grassland blazes are left to the agriculture ministry.
The plan also realigns some government functions with the aim of reducing the chances of a conflict of interest.
For instance, authority for managing climate change and pollution issues will be shifted from the economic planning agency to the Ministry of Ecological Environment, while responsibility for administering tobacco controls will move to the National Health Commission from the industry ministry.
Another significant change is the dismantling of the family planning commission. After four decades of the “one-child” rule, which often saw the brutal implementation of forced abortions and heavy fines for unauthorised births, China will no longer have a formal government institution to manage the issue.
Cheng Enfu, a researcher with the Chinese Academy of Social Sciences and one of the 3,000 NPC delegates who will vote on the plan, said on Monday that the new structure showed Beijing’s desire to create a more efficient bureaucracy, akin to those in “developed countries”.
“A developed country generally has about 20 or so ministerial bodies,” Cheng said.
Though even with the changes, China still had too many government agencies, he said, as “there are not only formal ministries but also many other ministerial-type institutions.”
One of the new additions to the government structure is a special commission for administering foreign aid, which aligns itself well with Beijing’s push to extend its global reach.
The merger of the two financial regulators was earlier exclusively reported by the South China Morning Post.
According to a statement from the State Council, China’s cabinet, the consolidation of the watchdogs will improve the current regulatory system which “was not clear on the division of responsibility” and help to “prevent any systematic financial risks”.
It did not mention any changes to the current stock market regulator, the China Securities Regulatory Commission.
“The new arrangement will lift the role of the central bank in the regulatory regime,” said Zhou Hao, senior emerging markets economist at Commerzbank.
“The current insurance and banking regulators will largely become executors of the policies set by the PBOC,” he said.
The plan will now be discussed by members of the country’s top legislative body, the National People’s Congress, and is expected to be passed by Saturday.
Here are the key changes included in the State Council reform plan as presented by Chinese Premier Li Keqiang to the NPC:
1. A Ministry of Natural Resources will be created to pull together functions previously scattered across different agencies, namely the Ministries of Land and Resources; Housing and Urban-Rural Development; Construction; Water Resources; and the National Development and Reform Commission, and State Forestry Administration. The State Oceanic Administration and the National Administration of Surveying, Mapping and Geo-information will also be subsumed into the new ministry.
2. The Ministry of Ecological Environment will be set up to take responsibility for climate change issues away from the National Development and Reform Commission, and centralise water pollution management.
3. A health commission will be created to partly replace the family planning commission.
4. A special agency for veterans will be established.
5. China’s audit office will be expanded as it takes over supervisory functions from the economic planning agency, and the state-owned assets supervision and administration commission.
6. A new market supervision super-bureau will be formed to handle various market regulatory functions, including anti-monopoly issues.
7. The insurance and banking regulators will be merged into a single organisation.
8. An immigration bureau will be created.
9. Local branches of state and local taxation administrations will be merged.
This article China slashes ministries in sweeping changes to reduce bureaucracy, end turf wars first appeared on South China Morning Post
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