Wen Jiabao

Provinces told to keep rein on debt

PUBLISHED : Monday, 03 July, 2006, 12:00am
UPDATED : Monday, 03 July, 2006, 12:00am

Rural governments must avoid piling up new debts as they push forward with rural taxation reform, the State Council has warned.

In a meeting chaired by Premier Wen Jiabao last Friday, the group discussed steps to expand rural taxation reform in provinces, according to Xinhua.

The meeting ended with a statement telling local governments they must strictly adhere to the central government's directive to ensure farmers' financial burden is not increased by the reforms.

The statement said provinces must add new pilot programmes for reform this year, and it encouraged provinces with financial strength to extend the reforms.

Mr Wen has pushed the rural reforms - under which farmers would no longer be required to pay agricultural taxes and other fees - to narrow the wealth gap between urban and rural areas.

The statement also said that while rural governments should streamline bureaucracy, they should also strengthen their public services.

Rural governments were told they had to establish properly-run financial systems and strictly control their debts.

They were also ordered to allow farmers to play a role in supervising the governments' accounts.