China's national revenue rose to 2.64 trillion yuan (about US$ 318.07 billion) in 2004, 21.4 percent more than the previous year and representing 111.8 percent of the budgeted figure, according to a report of the Ministry of Finance.

"The central and local budgets were implemented well," says the report on the implementation of the central and local budgets for 2004 and on the draft central and local budgets for 2005, which was submitted Saturday to the annual session of the National People's Congress (NPC), China's top legislature, for approval.

According to the report, national expenditures totaled 2.84 trillion yuan (about US$ 343.14 billion), 15.1 percent year-on-year and representing 105.9 percent of the budgeted figure. Expenditures exceeded revenue by 200.49 billion yuan (about US$ 24.24 billion). The revenue figure excludes revenue from generation of debt.

Total revenue in the central budget amounted to 1.51 trillion yuan (about US$ 182.44 billion), up 215.07 billion yuan (about US$ 25.96 billion) after deducting the additional 127.53 billion yuan (US$ 15.41) used for export tax rebates. That's a 16.6 percent rise over the previous year and representing 109.1 percent of the budgeted figure, the report says.

Total expenditures in the central budget came to 1.83 trillion yuan (US$ 221.1 billion), including 1.04 trillion yuan (US$ 125.66 billion) in tax rebates and subsidies for local authorities, 13.3 percent more than the previous year and representing 107.4 percent of the budgeted figure, says the report.

The report says the total revenue in local budgets amounted to 2.23 trillion yuan (US$ 269.4 billion), including tax rebates and subsidies granted by the central government, 22.9 percent year-on-year and representing 112.6 percent of the budgeted figure. Total expenditures in local budgets came to 2.11 trillion yuan (US$254.94 billion), 18.1 percent more than the previous year and representing 106.6 percent of the budgeted figure, says the report.

According to the report, the main situation during the implementation of the central budget and financial work in 2004 is as follows.

-- The central budget was implemented in accordance with the law and revenue in excess of the projected figure was properly utilized.

-- Following a scientific outlook on development while taking all issues into consideration.

According to the report, support for agriculture, rural areas and farmers from the central budget in 2004 was the largest in many years.

-- Making steady progress in reforms to promote enterprise development and improve the economic structure.

It says a total of 19.95 billion yuan (US$ 2.41 billion) was earmarked in the central budget to subsidize policy-based closure and bankruptcy of state-owned enterprises, and arrangements were made for 537,500 laid-off employees.

The report says a reform was carried out to introduce a centralized treasury payment system in 140 central government departments and over 2,600 of their subsidiary units responsible for preparing their own budgets. Total government procurement exceeded 200 billion yuan (US$ 24.16 billion) in 2004, resulting in a saving of about 10 percent in the use of funds.

The report says in general, implementation of the budget for 2004 went better than anticipated and some achievements were scored in the process.

"But we are fully aware that there are still some problems that cannot be ignored in the implementation of the budget," it says.

According to the report, authorities at the lower levels in some areas are still experiencing financial difficulties and more funds are urgently needed to safeguard government authority at those levels and strengthen their ability to serve the public.
 
In addition, problems related to economic development are beginning to accumulate and affect budget implementation. In particular, potential risks to financial institutions and local governments due to debt levels have increased. The amount of funding provided to weak links in urgent need of strengthening in economic and social development is not enough.

The State Council is paying close attention to these problems, the report says. The Ministry of Finance, relevant departments and local governments have adopted effective measures in a great effort to deepen reform, restructure expenditures and intensify their work, says the report.

(Xinhua News Agency March 5, 2005)