Opinions of the Wuxi Municipal People's Government on Further Strengthening the Management of Local Government Debts and Innovating the Development Modes of City Construction
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Index No.


Creation date


Issuing date


Document No.

Xi Zheng Fa [2017] No. 216

Limit of publicity

Long term

Issuing department

the Wuxi Municipal People's Government

Forms of publicity

On websites

Mode of publicity

Initiative publicity

Range of publicity

The whole society

Period of validity

Long term

Procedures of publicity

Publicity after being drafted by the department and approved by relevant offices

Theme (the 1st level)

Finance, finance, auditing - finance



Key words

Budget, debt, opinion

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Opinions of the Wuxi Municipal People's Government on Further Strengthening the Management of Local Government Debts and Innovating the Development Modes of City Construction



Opinion of the Wuxi Municipal People's Government on Further Strengthening the Management of Local Government Debts and Innovating Development Modes of City Construction


All city (county) and district people's governments, municipal committees, offices, bureaus and subordinated units,


In order to fully implement the strategy of governing the country by law, according to the newly revised Budget Law of the People's Republic of China, Opinions of the State Council on Strengthening the Management of Local Government Debts (Guo Fa [2014] No. 43) and relevant opinions and schemes which are formulated by the Ministry of Finance and Jiangsu Province since a period of time, actively give full play to the important role of the government in regulating debt to economic and social development, innovating the investment and financing method of city construction, promote the integrated development of industry and city, firmly guarantee that no regional and systemic risk base line will occur, now put forward the following opinions on further strengthening the management of local government debts of Wuxi and innovating development modes of city construction.


I Further normalize the borrowing and financing behaviors of local government


i Strictly implement the provisions of the local government on borrowing and financing. Strictly implement the provisions of the Budget Law of People's Republic of China, borrowing of municipal, city (county), district and local governments shall apply for local government general bonds and special bonds within the approved debt limit, except this, the local government and its subordinate departments shall not borrowing in any way. According to the requirements of the Ministry of Finance and other departments on the Notice of Relevant Issues on Normalizing Land Reserve and Fund Management (Cai Zong [2016] No. 4), since January 1, 2016, all banking financial institutions are not allowed to borrow loans for land reserves. All localities shall actively create conditions, do well in full-caliber budgetary administration of the government, improve the risk index of local government debt, and fight for the local government debt limit.


ii Clear up the behavior of local government financing guarantee in time. Contrast with the requirements of the Ministry of Finance and other departments on Further Normalizing the Borrowing and Financing Behaviors of Local Government (Cai Yu [2017] No. 50), carry out a comprehensive clean-up work for local government financing guarantee, strengthen equal consultation with social capital side, improve the terms of the contract according to the law, classify and dispose properly, and timely report clean-up and rectification situation according to the requirements of superiors. Local governments and their departments shall not require or determine the enterprises to borrow money for the government or disguised as government borrowing in any forms such as files, conference summaries, leadership instructions and so on. In addition to loans on-lending of foreign governments and international economic organizations, the local governments and its subordinate departments shall not provide guarantee for debts of any unit or individual in any way, shall not promise to bear debt repayment liability for the financing of any units and individuals.


iii Resolutely stop illegal financing in the name of purchasing services. Be in accordance with the Notice of the Ministry of Finance on resolutely Stopping the Illegal Financing in the Name of Purchasing Service by the Local Governments (Cai Yu [2017] No. 87) strictly, stipulate and normalize the service purchase behavior, of the governments, strictly prohibit to treat the railways, highways, airports, farmland and water conservancy construction projects, and infrastructure construction of education, medical and other fields as the government purchase services. Reform of governmental purchase services shall focus on connection with reform of public institutions and out of contact with industry associations and chambers of commerce, the necessary funds of the government purchase services shall be fully arranged according to the actual amount in the annual budget and medium-term fiscal planning. Government procurement services shall adhere to the budget first, then purchase the services, we shall not treat the government purchase services as the gist of increasing budgets and financial expenditure of the units.


iv Accelerate the replacement of the local government's stock debts. In accordance with the requirements of Implementation Opinions of the Provincial People's Government on Strengthening the Management of the Government Debt (Su Zheng Fa [2016] No. 154), make full use of the replacement policy, actively negotiate with creditors, and strive to replace all the government stock debt that can be replaced into local government bonds. Encourage to use social capital to transform the stock of debt, actively create conditions for the introduction of social capital through PPP and other mode, transform the stock of government debt, and adjust the relation of right, responsibility and benefit accordingly, and transform parts of the conditional government debt into non government debt. The people's governments at all levels are responsible for repaying the due government debts which are borrowed by them on time, strengthen financial management, broaden debt repayment channels, and coordinate funds to repay on time for the due governments or relevant borrowing debt units which have debts to be guided and supervised; if the borrowing unit is really difficult to return, the people's government at corresponding level shall properly dispose according to law.


v Properly solve the subsequent financing for the projects under construction. According to the spirits of the Notice of the Office of the State Council Forwarding the China Banking Regulatory Commission of People's Bank of China of the Ministry of Finance on the Solution of the Subsequent Financing for the Projects under Construction of the Financing Platform of Local Government (Guo Ban Fa [2015] No. 40), the local people's governments and banking financial institutions at all levels shall support the stock financing demands of the financing platform companies for the projects under construction, and ensure that all the projects under construction which were approved before September 21, 2014 are in an orderly way. For the loans of the projects under construction that have already signed a loan contract before December 31, 2014, but have not yet matured, continue to make loans according to the contract. For the loans of the projects under construction that have already signed a loan contract before December 31, 2014, and the contract has already expired, such as the operating income of the project is insufficient to repay the principal and interest in the premise, can revise the loan contract under the premise of no increasing of the loan amount, reasonably determine the loan deadline, and add qualified and effective collateral.


vi Strengthen the financing management of financing platform companies. Be in accordance with the requirements of the Ministry of Finance and other departments on Notice on Further Normalizing the Borrowing and Financing Behaviors of the Local Government (Cai Yu [2017] No. 50), accelerate the function transformation of the government, further standardize the financing management of financing platform companies, the local government shall not inject public assets and reserve land into the financing platform companies, shall not promise to use expected land revenue as the capital source for the financing platform companies to pay a debt. Improve the information disclosure mechanism, the platform companies which bore the financing functions of local government before January 1, 2015, when borrowing and financing at home and abroad, shall make written statement to the creditors that they does not bear the financing functions of the government, and make it clear that since January 1, 2015, the new debt does not belong to the local government debt.


vii Actively promote the transformation and development of financing platform companies. Further strengthen the management of financing platform companies, and promote the financing platform companies to transform to state-owned enterprises with market-oriented operations as soon as possible. For those "shelf type" financing platform companies which just take the financing tasks of public welfare projects and repay the debt mainly by financial capital, they shall actively resolve the stock of debt under the guidance of local governments, speed up the upgrading of enterprise operation, or shall be revoked according to the law; for the "entity type" financing platform companies which have the functions of both the government financing and construction and operation of public welfare projects, strip its government financing functions; for the "commercial type " state-owned enterprises which bear certain government financing functions, shall not financing for the government in the future.


II Further strengthen the "capital, assets, resources" operation of the governments


i Continue to optimize the budget structure and expenditure performance of government funds. Closely focus on the major strategic deployments of the CPC Wuxi Municipal Committee and the Wuxi Municipal People's Government, arrange the expenditure to repay the capital and interest for the necessary local government debt in priority, preferentially support the key areas which are urgent to increase investment to accelerate the coverage of the position and lengthening the short board. Further implement the requirements of strict economy, strict implement the provisions of the financial management system, and use the limited financial funds wisely. Adapt to the new normal characteristics of economic and social development, increase the intensity of integration and optimization of special funds, timely improve the special policies, innovate the use of special funds, and continuously improve the performance of financial funds.


ii Accelerate the establishment of regulating and controlling mechanism for the land resources in urban areas. The exploitation of land resources is the biggest potential for city construction and development in the future. In accordance with the principle of "unified management, overall balance, market segmentation and orderly supply", research and establish a sub regional value benchmarking system, and implement the scientific and dynamic management of the land resource market. Integrate the concept of "TOD" (public transport oriented development model), TOC (restraint theory) and "lean management" into the whole process of city construction and resource exploitation. Effectively give full play to the function of the land reserve center, scientifically formulate the plan of land purchase, storage and transfer, increase the intensity of purchasing and storage of land and demolition according to the law, perfect the land reserve cost accounting mechanism, accelerate to revitalize the stock of idle land, and improve the operation level and intensive utilization efficiency of the land resources.


iii Orderly promote various types of government stock assets to revitalize and achieve benefits. Further combing the idle real estate of administrative institutions in various regions, the technological "innovation, entrepreneurship and creativity" carrier which have inefficient use, government guarantee use housings and resettlement housings and ancillary commercial housings and other government stock assets, form a assets list that can be revitalized and achieve benefits, formulate the annual vitalization and use plan, reduce the waste of idle assets, pay the corresponding local government debt, improve the utilization efficiency of social resources, and provide a beneficial fund supplement for the development of local city construction.


III Further innovating investment and financing modes of city construction and development


i Overall planning and set up the mother funds for city construction, innovation and development. Under the premise of not changing the financial governance in the urban areas and expenditure responsibility system, in order to effectively solve the government project investment and schedule of the government revenue, sharing mechanism (partaking) for the transregional major infrastructure and time difference problems of financing resource with city (county) and district, and make overall planning for the construction funds of city major projects, financial stock capital and the surplus fund of that year and other capital sources and the funds which are matched with the responsibility that borne by each region, the available credit for the benefit of the makeup land-transferring fees that are arranged in the annual budget, and set up mother funds for the city construction, innovation and development. The mother fund can be invested to cooperate with social capital, and establish a sub fund, can also be directly invested for major infrastructure projects in the city, or be used for solving local government debt risk according to debt emergency plan of local governments in Wuxi after being approved and be based on the regional investment share.


ii Give full play to the role of state-owned enterprises, and promote the integrated development of industries and cities. Accelerate the deepening of the reform of state-owned enterprises, enhance the function of the state-owned enterprises, promote the capitalization of the state-owned resource, assets capitalization, assets securitization and security fluidification, and improve the gold content of state-owned capital and contribution degree of operation earnings of the state-owned capital. Encourage the state-owned enterprises to actively participate in city construction as the main market players, and promote the state-owned enterprises to be stronger and bigger in the process of integrating in city development, and realize the organic integration of state-owned capital management and city function development.


iii Actively explore the cooperation mode between government and social capital. Encourage social capital to participate in the urban business investments and operations which have certain benefits, such as urban infrastructure, development of characteristic parks and so on. The government helps the investors to have long-term and stable income through the revenue appointment rules which are opened in advance including franchise rights, reasonable pricing and financial subsidy and so on. The related competent departments of city construction at municipal level, state-owned enterprises shall take the lead in the implementation and promotion of the PPP cooperation mechanism of the government investment projects, encourage all the regions to promote and practice according to local reality, and promote the healthy and continuous boost of city construction and innovative development of real economy.


IV Further strengthen local government investment and debt budget management


i Advance the connection of government investment project plans and debt budget. Strengthening the advance planning, demonstration and reserve of government investment projects, improving the decision-making procedures and related procedures to meet the requirements of applying for on-lending quota of provincial new bonds, and lay the foundation for accelerating the implementation of the project after approval. Make overall planning of the city's development needs, the local government financial ability, new bond quota and the government and social capital cooperation, timely formulate the planning and drafting of government investment projects, formulate the budget of the government investment and debt, and promote the "prepare situation and money in advance". Give priority to the protection of key projects, which are of great significance to the development of the whole city, decided by the Wuxi Municipal People's Government and met the project conditions, give full play to the guiding role of government investment, and promote the healthy and stable development of city construction.


ii Strengthen budget fund management of government investment projects. Adhere to the basic principle of "overall balance, highlight the key points, stick to economy, normative adjustment", for those government investment projects which are brought into the annual budget, the financial department shall make overall guarantee and classified management according to the characteristic of the budget funds. Fully endow the budget rights to the project competent units, reduce the substitutive formulation items of budget, and timely issue to each budget unit to implement normatively after the government investment plan and annual budget are approved. Relevant budget units should strengthen the organization and implementation of the projects, strictly allocate funds according to the project rough calculation and budget. In the course of the implementation, the budget shall be adjusted in time in accordance with the procedures if faced with the force majeure such as the change of the implementation conditions.


iii Explore and formulate the medium-term financial planning for government investment. Conscientiously implement the spirits of the Opinion of the State Council on Implementing the Medium-Term Financial Planning Management (Guo Fa [2015] No. 3), we should not only make efforts to deal with new normal of economic development and the risk of local government debt, but also consider the long-term and overall planning, deal with the relationship between city construction and government income, moderate debt and quota management and control, research and formulate the three-year rolling plan of the government investment projects, promote development planning of economic society, all special plans to connect with the financial planning, strengthen the guidance quality and binding force of the financial planning to the annual budget, and promote economic structure adjustment and transformation of development mode.


V Further establish and complete the incentive and restraint mechanism of local government debt management


i Strengthen main responsibility of the local government debt management. People's governments at all levels are the main responsible bodies of government debt management in this region, and the principal of the government is the first responsible person. Local governments at all levels should change their concept of development, resolutely correct and prevent excessive debt situations which are divorced from reality and bearing capacity. Strengthen the sense of responsibility and effectively fulfill the supervision and repayment of local government debt. The people's governments at all levels shall arrange the government debt repayment funds, when the debt risk event happens in the area, they shall start the local finance reorganization plan, compress the basic construction expenditure, government public funds, suspend all the subsidy policy issued by local governments, adjust exorbitant expenditure standard, and suspend all the policy calculation and extraction of the land sale revenue.


ii Complete risk prevention and coordination mechanism of the government debt. Conscientiously implement the requirements of national, provincial and municipal "Emergency Disposal Pre-Arranged Plan" of Local Government Debt Risk, each region should combine with the local reality, formulate and complete emergency disposal pre-arranged plan of local government debt risk, and timely discover and resolve the potential financial risk. People's governments at all levels shall further play the function role of the leading group of government debt management and their offices, and strengthen the decision-adjusting, implementation and supervision of major issues of the government debt management. Financial departments at all levels shall improve the debt management system, refine the debt management measures, and do a good job of the specific management of government debt. Development and reform departments shall strengthen government investment plan management and project approval, and strictly examine and approve new projects invested by governments with higher debt risks. The competent financial departments shall strengthen supervision and urge financial institutions not to provide financing directly or indirectly in violation of laws and regulations. The audit departments shall strengthen the audit supervision of local government debt according to law, and promote the standardized management of debt. Other departments shall actively cooperate with the government to do a good job in debt management.


iii Do a good job in openness of local government debt information. Every year, the people's governments at all levels shall report change situations, incremental and reduced content of the local government debt balance, and construction situation of the major projects to the people's congress or its standing committee at corresponding level, and explain the important matters, and actively accept the supervision by the people's congress. Strict implement the openness system of the local government debt information, local governments at or above the county level shall focus on opening debt limit and balance of local government debt, and the scale, kind, interest rate, time limit, capital and interest repaying, usage of government debt. Government services purchase, cooperative project information of government and social capital in the annual budget and medium-term financial planning, shall be opened in accordance with the regulations in time.


iv Implement the accountability system for the assessment of local government debt. Treat the government debt as an important indicator of government performance evaluation, and figure debt audit into the economic responsibility audit of main party and government leading cadres. Strengthen assessment, auditing and accountability of the debt borrowing, use and management of the people's governments at all levels within the term of the government, and correct incorrect concepts of political achievements. Investigate and affix the responsibility of the relevant responsible persons for the activities including excessive borrowing which is divorced from reality, and illegal borrowing or illegal guarantee and use of debt capital, malicious evasion of debts and so on.


The opinions shall be implemented since the date of printing and issuing. Where the relevant documents are inconsistent with the present opinions, the provisions of this opinion shall be prevailed, where there are special provisions of the higher authority, follow its provisions.


 Wuxi Municipal People's Government


August 17, 2017