context: One of the unpublicised but privately acknowledged understandings about the annual Beidaihe conclave is that leaders will not overtly seek support for their policy views outside those meetings. Nonetheless, others will work to print essays and commentaries that reflect certain leaders' views, to signal developments at the meetings or to seek support for views or proposals. This brief article advocating more autonomy for local governments, originally printed in Beijing Daily and now finding its way into other Party media, is likely one of those efforts.
Three major challenges face efforts to modernise governance, says Zhou Li’an 周黎安 Peking University Guanghua Management School vice president, reports Nanjing Daily
- redefining boundaries between the government, the market and society
- defining boundaries of power and responsibility between central and local governments
- achieving a balance between incentives and constraints for officials
Zhou advocates reforming the tournament system (competition between localities) to both constrain and motivate local officials. He argues that including criteria beyond economic development into performance appraisal indicators, such as achievement in innovation, greenifying cities and environmental protection, will achieve that. Secondly, Zhou argues for introducing bottom-up assessment in addition to top-down assessment in performance appraisals, with cross-governmental sector competition and regional competition in public services.
With these checks and balances, the dilemmas of decentralisation can largely be avoided, says Zhou. Therefore, more power can be delegated to local governments (taxation and borrowing rights) while restricting local government intervention in the supply of national public goods (such as maintaining a unified market, eliminating local protectionism and regional discrimination in the labour market). Powers of central and local government should be adjusted, continues Zhou, with increased spending responsibility for local governments: central government should increase tax transfer payments to improve the balance between local government powers and their financial resources.