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Policy Options on Strengthening Supervision and Management of Integrated Funds for Agricultural Development in Poverty-Stricken Counties



By Cheng Yu, DRC


Problems in integrating the use of funds have been neglected in light of the effective use of China’s fiscal funds. Many funds have been allocated in line with the guidance of relevant departments while it is difficult to integrate them together, which may fail to put these money in right place. The diversified allocation of these funds will also lead to the result that some projects may not be able to get continuous fiscal support. In applying for funds, the application units should not be allowed to raise tailored projects or put forward requirements that have nothing to do with poverty alleviation. In so doing, the aim is to give better play to fiscal funds. Through the coordination by related ministries, funds for similar projects are integrated together and grouped into the same category with the projects, and then funds are allocated to application units according to overall plans and this has changed the past practice of allocating funds by items. After local provinces receive the integrated funds for agricultural development from the central finance, local governments will have an ample room to make use of these funds. This will enable them to overcome the defects that the change in the purpose of fund use may involve different project standards and to address accountability issues relating to government performance evaluation. Besides, after the adjusted budgetary funds are allocated to application units, they will make corresponding expenditure accounts according to their usage for various items. The process for the allocation of related funds for agricultural development can be accelerated, and funds will be allocated once a project is properly prepared to ensure that there is no retention of funds. As for supervision, apart from strengthening supervision by the Central Government, some pilot modes can be tried for supervision improvement. For example, after local governments submit a fiscal budget plan to the Central Government according to the needs of construction development each year, the Central Government will make related evaluation on each item of these fiscal funds, and conduct afterwards evaluation according to the completion of fiscal funds budget.


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