Hu Jintao

Loopholes face graft busters' scrutiny

PUBLISHED : Saturday, 01 January, 2005, 12:00am
UPDATED : Saturday, 01 January, 2005, 12:00am

Plans for the campaign against corruption are cloaked in secrecy

Closing loopholes that allow public servants to get away with corruption is expected to be the top priority for the mainland's graft busters this year, analysts say.

The issue was discussed at a Politburo meeting this week which approved outline proposals for instilling integrity and preventing corruption among Communist Party members.

Unlike high-profile anti-corruption campaigns of the past, the contents of these draft plans remain cloaked in secrecy. There is speculation the crackdown could be carried out with the help of surprise raids.

Several recent developments suggest the party will seek to address public discontent over shady deals that have transferred state assets into private hands.

A recent conference of procurators-general identified infrastructure projects, financial institutions, land management and state-owned-enterprise (SOE) restructuring as areas requiring investigation and prosecution.

Yang Fengchun , a professor of public administration at Peking University, said state-owned enterprises' asset sales were coming under closer scrutiny.

In the past year, more than 40 per cent of corruption cases involved cadres in SOEs.

Wu Jinglian , a prominent economist, wrote in Caijing magazine that the opaque nature of privatisation procedures for collective enterprises made the process a breeding ground for corruption, and the trend was getting worse. Mr Wu doubted that sporadic crackdowns on abuses or the issuing of more laws and regulations could fundamentally address the causes of corruption. Instead, he advocated further liberalising the economy and introducing free-market competition to reduce opportunities for graft.

In the 1980s, the existence of government quotas, import and export permits and foreign-exchange allocations also provided ripe opportunities for corruption, but they became less of an issue with the greater opening up of the economy and the reduction in government intervention, he wrote.

Until the party congress two years ago, free-market thinking prevailed and the party even opened its doors to entrepreneurs, but a veteran party member said a prescription such as Mr Wu's was more problematic now, given the current leadership's more rigid ideological stance.

He said the outline of the anti-corruption proposals was likely to include the wishes of President Hu Jintao that cadres return to the earlier virtues of serving the people and living a simple life, but would lack specific measures for stemming the loss of state assets.

Auditor-General Li Jinhua , who sparked a storm with an unprecedented mid-year disclosure of suspected misappropriation of public funds by government agencies, this week won top place on a CCTV honour roll of the most influential economic figures of last year.

Professor Yang said a crackdown on headline corruption cases was all well and good but failed to address the root cause of the abuse.

'Corruption is the result of the malfunctioning of the system,' he said. 'The reform needs to focus on bringing in more checks and balances and more transparency.'