BEIJING -- China unveiled new measures Wednesday to prevent misuse of water pollution funds.

A performance rating framework will be set up to assess whether the money is spent wisely and whether the anti-pollution project is well managed, according to a statement jointly released by the Ministry of Environmental Protection and the Ministry of Finance.

After a comprehensive review on their performance, fund users will be graded on a four-tier rating system, and local authorities will reward the good, and punish the bad, the statement said.

The detailed guideline came as authorities try to rein in the misuse of environmental funds. China's top auditor has found that 17.6 billion yuan (about $2.56 billion) of fiscal funds for pollution control and resource management in 2016 were not used effectively.

A total of 397 water protection projects had failed to achieve the desired effect, and some environment funds were not distributed in accordance with special protection plans, according to the National Audit Office.