Ministry considers tendering environmental clean-up to private firms

Ministry weighing plan for local governments to outsource environmental management

PUBLISHED : Friday, 23 May, 2014, 3:30am
UPDATED : Friday, 23 May, 2014, 3:30am

The Ministry of Environmental Protection is considering a new policy to boost its use of private contractors, state media reported yesterday.

The move would allow the market economy to play a greater role in easing the country's pollution woes.

It calls for local governments to commission services from private firms, including sewage treatment, waterway clean-ups, national park maintenance, remediation of contaminated soil and pollution monitoring, according to the Xinhua-controlled Economic Information Daily.

The contracts would be arranged through public tender, the newspaper said. Details of the new policy are to released next month.

The final payment would be based on the results achieved through the services, making government spending on cleaning up the environment more efficient, the report said, quoting an unnamed official.

"[The move] will redefine how local governments spend their funds on environmental protection," the official said. Previously, such public procurement applied only to building treatment facilities, and was not linked to cleaning up.

Under existing practice, for example, some local governments are responsible for building and operating urban sewage treatment plants.

Under the new policy, private companies would be invited to provide such services and be paid according to the quality they provided, the official said.

The idea of offering businesses and social organisations more incentive to tackle environmental damage was floated in a resolution released following the meeting of senior party leaders in Beijing in November.

Government spending on environmental protection and energy conservation totalled 180 billion yuan (HK$226 billion) last year. The Ministry of Finance has called for a 16.7 per cent increase in spending, to 210 billion yuan, this year, as the top leadership declared war on pollution in March.

Environmental experts, including Qu Geping , the first minister of the environment, say that, given its fast-growing economy, the mainland needs to spend between 2-3 per cent of its annual gross domestic product on fighting pollution. Current levels of spending are far from adequate, they say.

Even the money that is being spent is not well managed, according to official figures.

The National Audit Office said in June that 1.6 billion yuan of government expenditure on energy conservation and environmental protection had been misused or embezzled in 2011 and 2012.

Some local governments are beefing up their own investment in the face of rising public pressure to tackle acute pollution.

Beijing and neighbouring Hebei province will spend 760 billion yuan and 424 billion yuan, respectively, before 2017 to fight worsening smog.

Some experts say there must be independent oversight on the use of the funds. Lin Shuanglin, a professor of public finance at Beijing University, said the public bidding process could invite corruption unless the process was properly supervised.



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