Chinese Government Departments in Race to Spend CNY 2.5Trl in Dec12-12 17:40 Caijing
China still has as much as 2.5 trillion yuan left in budget for the last month of the year, government data showed, sparking concerns that the central government and local government departments may embark on rush attempts to spend in a reckless way.
Such a scenario is not new in China but financial data suggests it is especially extreme this year. National public spending was 2.08 trillion yuan in December 2012, data from the Ministry of Commerce showed.
Officials would prefer spending up all money as budgeted, otherwise they would face having their budgets cut next year.
Fiscal expenditure aggregate in the first eleven months stood at 11.5 trillion yuan, up 980 billion yuan, or 9.3 percent from the same period of last year, according to data released Wednesday by the Ministry of Finance. Among them, central spending rose 4.7 percent year-on-year while local fiscal spending was up 10.2 percent from a year ago.
China budged to spend about 13 trillion yuan in 2013, and deducting 11.5 trillion, the central government and local government departments are likely to spend 2.5 trillion yuan in December, accounting for roughly 17.86 percent of total expenditure, the MoF said. That compared with a percentage of 16.56 percent in 2012.
Economists have repeatedly urged the government to make budget more predictable and detailed. The process of budget needs to be "refined", Cao Mingxing, an expert at University of Finance and Economics, said in an interview with the Beijing Times. He said the "crudity of budget" should be largely blamed for the year-end rush to spend.
Also on Wednesday, the MoF said China's fiscal revenue in November grew 159 percent from a year ago to 912 billion yuan, bringing the total in the first eleven months to 12 trillion yuan.
The gradual gain in central revenue growth was a result of economic recovery, and improvement in trade in recent months, the MoF said.
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