Timely budget allocations

Over the weekend, it was announced that the central government has now allocated 16.03 billion yuan ($2.61 billion) to a special fund to support preschool education. This money will be used to build more kindergartens and train more teachers in the middle and western regions of China to give children from poor families easier access to preschool education. More than 65,000 kindergartens have been built and 139,000 children subsidized since the project was launched in 2011.

The money is no doubt good news for the needy kindergartens, teachers and families. However, the timing could have been better, says a Beijing Youth Daily commentary. It would be more effective if such money was allocated at the beginning of each fiscal year, instead of toward the end of the year.

The annual education budget has to be approved by the people's congresses in March each year and usually the fund will not be allocated until October or November. For more than half a year, schools try to survive on other means and local governments have to tap into funds for other purposes to support schools while waiting for the education fund.

However, as soon as the fund arrives, they tend to exhaust it by the end of the year so that next year their budget can be at least as big. Otherwise, the budget for the next year will be cut according to the surplus.

This phenomenon is not unique to education. A trend has emerged in recent years in which light spending occurs in the first quarter of the year while heavy expenditure happens toward year-end - December usually accounts for more than 20 percent of expenditures. It is difficult to ensure that money is spent in a wise and efficient way under such a mentality and timeframe.

A change to the traditional way of budgeting and allocating funds is needed. For long-term and fundamental projects such as preschool education, a plan spanning three to five years is needed, and the fund should be guaranteed and allocated in a timely manner. There should also be close supervision as to how the fund is used and managed. The issue relating to the legal responsibility of budget expenditure should also be dealt with.

(China Daily 11/25/2013 page8)