3. We gave more support for the building of a new socialist countryside.

Funding for agricultural subsidies increased substantially. The central government spent 27.6 billion yuan, an increase of 130 percent, to provide farmers with general direct subsidies for buying agricultural production supplies. It also spent two billion yuan in subsidies for purchasing agricultural machinery and tools, up 233.3 percent, and 6.66 billion yuan in subsidies for growing superior grain varieties, up 60.5 percent. Direct subsidies to grain growers nationwide came to 15.1 billion yuan, and in 13 major grain-producing provinces and autonomous regions these subsidies accounted for more than 50 percent of those areas' grain risk funds. The government set price floors for the purchase of grain and bought 28.95 billion kilograms of wheat. The central government allocated 10.53 billion yuan to support the production of hogs, dairy products and oilseeds and ensure that supplies were adequate to meet demand. We carried out trials to subsidize insurance premiums for essential crops such as rice and wheat in six provinces and autonomous regions. We also supported programs to train 3.5 million rural workers for nonagricultural employment as well as scientific and technological training programs in 20,000 villages to foster a new type of farmer.

Rural working and living conditions were improved. The central government spent 19.46 billion yuan to continue funding the construction of six categories of small rural projects [water-efficient irrigation, potable water supplies, road building, methane production facilities, hydroelectric plants, and pasture enclosure, Tr.] and another 4.2 billion yuan to build small water conservancy facilities and renovate small, dilapidated reservoirs. A total of 11.57 billion yuan was spent to promote overall development of agriculture, resulting in 1.57 million hectares of low- and medium-yield farmland being upgraded and high-grade arable land being cultivated, and in three billion kilograms of grain production capacity being added last year. Part of this sum also went to 1,457 projects to make agricultural operations more industrial. An additional 17.2 billion yuan paid out to the central government in compensation for land converted to development purposes was used to develop and protect primary farmland, improve land and cultivate arable land. One billion yuan was appropriated to promote the development of farmers' specialized cooperatives and the dissemination of agricultural science and technology. In addition, 1.29 billion yuan was spent to improve the distribution of goods and develop the market system in the countryside.

Support was given to fight natural disasters, provide disaster relief and reduce poverty through development. In response to serious natural disasters in 2007, the central government promptly appropriated 13.3 billion yuan for disaster relief, supplemented by generous appropriations from local governments. To intensify poverty reduction through development, the central government spent 14.4 billion yuan mainly in poor areas in the central and western regions. We also made innovations in working mechanisms, which made our poverty reduction efforts even more effective.

We promoted the development of rural social programs. We gave strong support to rural compulsory education, a new type of rural cooperative medical care and other rural social programs. We continued to implement the system for rewarding and supporting some rural families that observed the state's family planning policy and carried out the "fewer children equals faster prosperity" project in the western region. Trials for a special assistance system for family planning were launched in selected areas.

Altogether, 431.8 billion yuan from the central budget was spent on agriculture, rural areas and farmers, an increase of 80.1 billion yuan or 23 percent. It should be pointed out here that expenditures supporting agriculture, rural areas and farmers do not constitute a single budgetary item. In order to make it easier for you to examine and deliberate expenditures in this area, we have combined all expenditure items related to agriculture, rural areas and farmers so there will be some overlap with expenditures for education, medical and health care, etc.