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China’s New Era: Administrative Reform

Jul 05, 2018 10:45AM ● Published by Kathleen Maris

By Xiaobo Hu

The Chinese Congress launched long-awaited administrative reform this past March. Prior to this, there were multiple versions that emerged in different circles for discussion, as well as for testing to see how much resistance there might be against another round of administrative reform.

There have been a number of administrative reforms, mostly in the name of rationalization and reduction of bureaucracy. Indeed, there was—and still is—much to reduce, and the purpose claimed this time is again to streamline government responsibilities, minimize bureaucratic infighting, and enhance governance capacity in face of the “new normal.” The “new normal” is the expectation of increasing social issues and problems as China’s economic growth is slowing down from 7 percent to 6 percent this year.

When it established a new government structure in 1949, China started with 30 ministries and commissions in the central government under the State Council. This number increased to 81, before it launched its first decentralization reform in 1957-59. During the reform, the number of ministries and commissions was cut down to 60 central government units. It then grew back to 79 units in 1965 before its second decentralization reform. As a result of the second decentralization reform, the central government bureaucracy was cut down to only 32 units. Then it went back to 100 units in 1981, the historic highest number of central bureaucracies. The third decentralization started around the same time and has since gradually and steadily reduced the central government in a way that seems irreversible.

In the following year, the central government was cut down to 61 units and the staff was also reduced from 50,000 to 30,000, with the rest of the staff moved to government-affiliated organizations as a way to phase out this employment in a couple of steps and make such a big reduction less dramatic. In 1988, the central government was further cut down to 41 units, with the closing of another 9,700 positions. In the next round of administrative adjustment, the central government was reduced to 40 units and another 20 percent reduction of staff. This trend has continued, with reduction to 29 units in 1998, 28 units in 2003, 27 units in 2008, and 26 units in 2013—the historic lowest number of central government units in contemporary China.

The administrative reform this year is more a re-organization than reduction. The number of units stays at 26, but the re-organization appears massive. At least three features stand out and they affirm the government’s working priorities in the years to come.

First, risk management, or emergency management, becomes a priority, particularly in the areas of resource preservation and efficiency, social stability, and social welfare enhancement. For instance, as a result of the re-organization, the State Council has established a number of new units. These include Ministry of Ecology and Environment, National Medical Security Bureau, and Ministry of Emergency Management. This last ministry pulls together a number of emergency units previously supervised by different ministries, such as units dealing with natural disasters or public health issues.

Second, the new administrative reform tries to strike at better coordination among different government units. For instance, the central government has merged a number of units and established such new ministries as Ministry of Agricultural and Rural Affairs and China Banking and Insurance Regulatory Commission, as well as put all other market-related functions under a new State Administration for Market Regulation.

Third, it enhances government services by reorganizing and establishing a number of issues and problems-oriented units, such as National Health Commission, Ministry of Veterans Affairs, and State Migration Administration.

It is important to add two points here. One, the government’s anti-corruption efforts remain a central priority and they have been standardized and institutionalized. The “rule by law”—a new Chinese government commitment—receives a prominent emphasis in this new round of administrative reform. Two, by creating Central Foreign Affairs Commission and China Agency for International Development and Cooperation, the reformers recognize the importance of international environment and China’s foreign policy as an integral part of China’s stability and its continued economic growth.

This new round of administrative reform continues to represent the desire of China to reduce bureaucracy and make the government work more efficiently. They believe that’s what has made, and will continue to make, their economy grow at a faster rate.
Viewpoints, Enterprise

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