For some rural officials, being deemed a poverty-stricken county is a cause for celebration

Each year, 592 poor counties receive billions of yuan in aid. Making the list can be a cause for celebration, and a reason to keep the status quo

PUBLISHED : Monday, 13 January, 2014, 4:53am
UPDATED : Monday, 13 January, 2014, 5:15pm

To get rich is glorious, late leader Deng Xiaoping said, but to some county officials, staying poor has advantages.

As part of its efforts to alleviate poverty, the central government each year gives tens of billions of yuan to 592 chosen counties it keeps track of with a list.

The list - in effect, a benchmark of poverty - is updated every year, but in reality, it changes little. A few names might be added or removed, but for reasons known only to officials, the total number must stay at 592.

Most of the counties are truly in need, home to farmers who fall below the official national poverty line of earning 2,300 yuan (HK$2,925) a year or less. But making the list can mean receiving millions of yuan in handouts.

"Counties compete fiercely to get onto the list," said Du Xiaoshan, deputy director of the Rural Development Institute under the Chinese Academy of Social Sciences. "Once selected, some counties try all means to stay on it, so they can continue to enjoy the benefits."

In some instances, a lack of accountability has led to abuses. Hailun, a county-level city in Heilongjiang province, has been on the list since 2012. A fifth of its 800,000 residents earn less than 1,300 yuan a year, and 70 per cent of its farmers rely on loans to survive.

But Hailun's sparkling new municipal office buildings suggest a wholly different standard of living. Local media reports say the 30,000 square metre complex - a main building of 13 storeys and two of five-storeys - contains 820 offices rooms and underground parking for 235 cars.

The project is believed to have cost more than 100 million yuan, about 20 per cent of the city's total fiscal revenue for 2012.

A private property development company helped finance the construction, local news reported. In exchange, the developer obtained rights to parcels of land totalling hundreds of thousands of square metres, which it is using for villas priced at about 3,500 yuan per square metre.

"Though the construction money might not come directly from public finances, the land trade should still be regarded as a misuse of public funds," Du said. "The money should be used to improve people's livelihood, not to build office buildings."

Officials from the city's publicity and poverty alleviation departments declined requests to be interviewed .

Hailun's case is not uncommon. A recent National Audit Office report on 19 counties on the list, which had received 3.9 billion yuan over the past three years, found that at least 234 million yuan had been misused through false declarations of expenses, embezzlement or waste. Some 137 people are being investigated.

Lawmakers questioned some aspects of the system at a meeting of the National People's Congress Standing Committee in late December. "Some poor farmers would rather stay on the list to get subsidies, while some poor counties even celebrate publicly when deemed to be a 'poverty-stricken county'," Xinhua cited lawmaker Gu Shengzu as saying.

Liu Yongfu, director of the State Council Leading Group Office of Poverty Alleviation and Development, vowed to set up a mechanism to identify counties that could be moved off the list. He also pledged to refine the system so that funds went to directly to raising people out of poverty.