A FORMER associate of ousted party chief Zhao Ziyang has been appointed head of a committee to draft the nation's Ninth Five-Year Plan (1996-2000). Sources in Beijing said yesterday that Wen Jiabao, an alternate member of the Politburo, would lead a team of 19 drafters of the 'blueprint for the 21st century'. It is expected to recommend an annual growth rate of seven to eight per cent, with inflation to be kept below 10 per cent. Mr Wen, a former aide to Mr Zhao, has steered clear of liberal views on both economic and political reform since the June 4, 1989, crackdown. On the major issue of the reform of state enterprises, 47 per cent of which are losing money, the plan will seek to 'divide the burden' between the state, enterprises, workers and foreign investors. For example, the bulk of the chronically loss-making mines and factories will be declared bankrupt or broken up. Parts of such units which still have potential for profitability will be sold to, or merged with, foreign and domestic companies including private concerns. The bad debts, however, will have to be shouldered by the state banks and the buyers. Laid-off employees will be given severance pay which could be as low as 20,000 yuan (HK$18,640) per person. Sources said preparation of the blueprint was under the direct control of the Party Central Committee's Leading Group on Finance and Economics, headed by President Jiang Zemin. They said the first draft of the plan should be ready by July. It will be vetted by senior party and government cadres when they converge on the northern seaside resort of Beidaihe in August for informal meetings. The final version will be passed at the Fifth Plenum of the Central Committee, which is expected to be called in September, and endorsed by the full session of the National People's congress next March. 'Befitting the cautious nature of Jiang Zemin, the plan's guiding principles are stability and balance,' an economic source said. Overall, the plan does not opt for radical measures such as privatisation or the formation of a large number of joint-stock companies. It recommends moderate steps are centred on modernising management structures. In line with Mr Jiang's political need to mollify the proletariat, the Five-Year Plan lays emphasis on the fact that workers are the 'owners' of the country as well as enterprises. It promises that by the year 2000 a modest social insurance programme will be put into place. Unlike the Eighth Five-Year Plan, the blueprint underscores the imperative of lessening the income gap between eastern and western China. It also enshrines the 1950s-vintage principle that grain is the 'key link' of agriculture and the economy as a whole. 'At least in the first half of the five-year period, the plan will continue to recommend a tight control on prices, in particular those of grain, cotton and other essential produce as well as agricultural raw materials such as fertilisers,' said an economist familiar with the drafting process. The economist quoted a recent speech by Vice-Premier Zhu Rongji on the fact that policymakers 'need not be afraid of being criticised for recentralising decision-making powers'. The vice-head of the blueprint drafting committee is Minister of the State Planning Commission Chen Jinhua, a member of Mr Jiang's Shanghai Faction. Another key member is Jiang protege Zeng Peiyan.