By Zhengxu Wang.

In 1998, the then Premier Zhu Rongji ably pushed through a reorganization of the State Council that almost halved the number of ministries. A large number of ministries, such as those responsible for the chemical industry, textile industry and coal industry were closed down, greatly reducing the government’s direct involvement in the economy.

This was a great example of how operational reforms can lead to fundamental changes in China’s political economy.

Recently a document emerged on the internet. It contains allegedly leaked information of the Party’s plan to restructure the State Council ministries. The author(s) of the document obviously intend to generate  attention and debate in China’s public space, so that the top leaders will pick up the ideas as they prepare for the agenda items of the 18^th Party Congress.

Some of the ideas in that document may sound  radical, but upon closer examination they make a lot of sense. For example, the Ministry of Railways should be closed down and the regional railway bureaus converted into for-profit commercial firms. The regulatory function of the Ministry can be relocated to the Ministry of Transportation.

Such restructuring of a government ministry can lead to the reorganization of the railway industry in a similar way to how the airline industry was reorganized.

In today’s China, a large number of ministries or state general bureaus are failing to provide necessary services and are instead obstructing social and economic development. Closing down or downscaling them will serve a threefold purpose: reducing the government budget, releasing the energy of social and market actors and improving governance.

For example, the Ministry of Population should be seriously downscaled. With China’s population growth diminishing, there justification no longer remains for a ministry to be in charge of this policy. Some necessary services the Ministry can still provide, such as population forecasting, can be relocated to the Ministry of Labour. A few other services can be relocated to the Ministry of Health.

The three General Bureaus of Radio and TV, Publishing and Sports should be merged into the Ministry of Culture. So should the Bureau of Tourism. The ministerial-ranked Chinese Academy of Sciences and Chinese Academy of Social Sciences should be converted into non-governmental research institutions, the same as colleges and universities.

In total, the ’leaked‘ plan would reduce the number of ministries from the current 27 to 18. This would amount to a significant round of dabuzhi (grand ministry) reform.

The so-called ’grand ministry‘ reform attempted in 2008 did not seem to gain much mileage. There existed public expectation that several ministries were to be closed down and that the government would emerge more competent and efficient. But the outcome was highly disappointing.

The main reason was that at that time, the central leadership lacked the will and the support to push the tough reforms through. This time around, the general calls for reform are very strong in China. The challenge lies at forming the consensus on what to reform. 

Another round of restructuring the State Council might be a workable plan. To move toward that goal, this dabuzhi reform  idea should be put on the deliberation agenda of  the forthcoming Party Congress.

Dr Zhengxu Wang is Deputy Director of the China Policy Institute and Lecturer at the School of Contemporary Chinese Studies, University of Nottingham

Opinions expressed in the CPI blog do not represent the views of the China Policy Institute or the School of Contemporary Chinese Studies at the University of Nottingham. They are the personal views of the bloggers/authors.