SOEs smaller but stronger
Updated: 2007-12-22 13:48
These giant enterprises handed in 765.43 billion yuan to the national exchequer in the first 11 months, representing an increment of 148.18 billion yuan, or a 24-percent increase, from the same period last year.
Contributions from such central SOEs now accounted for 20 to 25 percent of China's national fiscal revenue.
Along with jumbo revenue, which should have benefited common people, many constantly complained some SOEs were in such a monopoly position that they ate into consumer benefits.
For instance, expensive fees for making phone calls were brought up at meetings for the national congress every year. "Why should Chinese citizens be charged higher fees for making phones calls than in developed countries?" many queried.
The SASAC asked 116 pilot SOEs to turn in part of their revenue in 2006 to the government, a figure which was expected to hit 14 billion yuan. All central SOEs would hand in part of their revenue starting in 2007.
Eighteen enterprises that relied heavily on resources were required to hand in 10 percent of their revenue. Ninety nine others with a five-percent quota and two enterprises responsible for cotton and crop reserve were exempted from such obligations.
SASAC's Li Rongrong said the revenue would be used to finance reforms of SOEs, especially to support the arrangement of laid-off workers. It could be injected into the social security fund, if possible.
The news also prompted the Chinese public to anticipate that the revenue could be included into the public budget to give more support to needy sectors such as education and medical care.
Li also said the top annual salary for managerial staff of central SOEs was 1.18 million yuan. In addition, the SASAC would publish salaries of senior SOE staff in future to introduce more transparency amid mounting speculation due to secrecy of such wages.
Analysts said state-owned enterprises needed to have control of key sectors for the sake of national security. They agreed that the improvement of the public's welfare should be the ultimate purpose.
The WB's Zhang said the government should in particular guard against the privatization of monopoly gains.
Chinese authorities had reached consensus to bring more competition into monopolized sectors.
Zhang said the reforms of such sectors should continue to bring more market forces into play.
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