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Public Budgeting and Financial Performance

 The program of Public Budgeting and Financial Performance is an integrated research program covering policy research, local pilots, professional training, publication, international conference and media promotion. This program aims to help improving China’s public budgeting and financial performance management system, and adopting results-oriented approaches to ameliorate public budgeting and financial management model and enhance the cost-effectiveness of public financial funding, so as to provide feasible policy proposals to forge ahead financial system reform and rationalize the relationship between central and local governments. This project integrates CDRF’s existing programs, namely, Public Budgeting Reform Program and Government Performance Management Reform Program, and seeks for more thorough and intensive research. 

CDRF completes in 2012 the Performance Evaluation Project of Special Fund for the Transformation of Jiaozuo as a Resource-exhausted City, a program entrusted by the Finance Bureau of Jiaozuo City, Henan Province. The Finance Bureau of Jiaozuo City as well as the Finance Department of Henan Province attach great importance to this project and have promoted the new philosophy and methodology of performance evaluation contained in this project throughout Henan Province through themed lectures.

Entrusted by the Finance Bureau of Nanhai District of Foshan City, Guangdong Province, CDRF carries out the project of Target and Evaluation Indicator System of Financial Performance in Nanhai District. The project aims at helping the local government and financial department to deepen their efforts of financial performance management and evaluation. It also marks the start for CDRF to undertake independently the duty of performance evaluation. Fully recognized by local government and Finance Bureau of Nanhai District, all policy suggestions proposed by CDRF are adopted, and the final report of “Performance Evaluation of the Budget on Water Conservancy in Nanhai District 2013” is completed.

Of the two aforementioned projects, the former is centered on post hoc evaluation while the latter on ex ante evaluation, which are all important methodologies to improve the efficiency of government spending. These projects help CDRF to have a deep understanding of financial system and operation of local financing and accumulate valuable experience for related research.


 Initiated in 2005, the Research Program of Public Budgeting Reform is a comprehensive program integrating research, training, local pilots and international conferences. It aimed to promote the research of public budgeting and get the public, media and NGOs involved into public budget-making, so as to explore a feasible public budgeting model in line with Chinese national conditions. In 2006, China Development Research Foundation (CDRF) assisted local governments in Wuxi City, Jiangsu Province, and Harbin City, Heilongjiang Province, in carrying out the pilots of participatory public budgeting. It was the first successful attempt for Chinese local governments to guide and attract public participation in the process of allocating funds for social development, which witnessed a pursuit for innovative budgeting models at grass-root levels. In the meantime, CDRF sponsored several researches on public budgeting through public tendering. The Research Program of Public Budgeting Reform received substantial support from many agencies and organizations, such as NPC Financial and Economic Committee, Economic Committee of Chinese People’s Political Consultative Conference, Research Institute for Fiscal Science of Ministry of Finance, Ford Foundation, Britain’s Department for International Development, Canada International Development Research Centre and International Budget Program. In 2007, the Program bore abundant fruit. Its subprojects finished more than 20 reports on public budgeting management and public expense evaluation. And, in order to facilitate a better understanding of government expenditure structure and its analysis, CDRF re-compiled the Handbook of Public Budgeting on the basis of China’s revenue and expenditure system reform in 2007. The revised Handbook was published in March, 2008.

 The Research Program of Government Performance Management Reform was launched in 2006, aiming to promote Chinese government performance management reform by policy research and international communication. CDRF held two international conferences of government performance management reform in 2006 and 2007 respectively, hoping to have a grasp of the overall situation of Chinese practice in this regard, draw on foreign experience and promote face-to-face exchange between Chinese and foreign scholars, experts and government officials. In 2007, CDRF organized officials from the Ministry of Finance, Ministry of Supervision, Ministry of Personnel, Ministry of Civil Affairs, National Audit Office and Central Staffing Department to complete the research report Progress and Prospect of the Central Government Performance Management (CDRF Research Report, No. 27), which overviewed the progress, challenges and prospect of performance management for each central departments and commissions. In 2008 and 2009, CDRF organized a field investigation for both central and local government officials which visited the U.S. and European countries to learn their experience and explore the path of reform for China. In October, 2008, CDRF initiated the first Forum of Public Budgeting and Government Performance Management, with over 100 participants including scholars, experts and government officials from Beijing, Shanghai, Guangdong, Henan and Heilongjiang. After the forum, CDRF completed a research report named Theories and Practice of Chinese Local Government Performance Management Reform (CDRF Research Report, No.63), which reviewed the history of Chinese local governments’ conducting performance management and budgeting reform, summarized local successful experience and lessons, and explored solutions for problems emerging in the reform endeavors.

 

In the year 2011, the Public Budgeting and Financial Performance Program was launched on the basis of two existing CDRF programs, namely the Public Budgeting Reform Program and Government Performance Management Reform, which indicated a new stage for China Development Research Foundation (CDRF) to push forward the reform of public budgeting and government performance management. CDRF resorts to financial performance evaluation to achieve the target of forging ahead the public budgeting reform and directly participating in the work of public budgeting and financial performance management. CDRF helps the government to carry out financial budgeting performance evaluation, explores the system and methods for performance evaluation and designs the indicator system for performance evaluation. In addition, CDRF introduces into practice the participatory budgeting model to enhance the transparency of public budgeting and financial performance evaluation and increase the efficiency of allocating and utilizing financial funding. It is since 2011 that CDRF has inked agreements or MOUs with local governments in cities and districts like Harbin in Heilongjiang Province, Jiaozuo in Henan Province, and Nanhai district of Foshan City in Guangdong Province, and worked hand in hand to push ahead theoretical studies and practical exploration of China`s public budgeting and financial performance reform.

 

December 8th in 2011 saw the signing ceremony between CDRF and the Finance Bureau of Jiaozuo City, which marked the starting of public budgeting and financial performance pilot in Jiaozuo. The cooperation aims to promote the reform of performance management and evaluation of the special transfer payment funds for the sake of people’s livelihood. CDRF will help Jiaozuo government to design a performance evaluation management system and indicator system, organizing experts to carry out project-based performance evaluation, and have a better picture of social satisfaction degree through questionnaires, ultimately providing policy advices for governments’ financial performance management reform.