Another attempt to slash the world's oldest and largest bureaucracy inevitably provokes a measure of weary cynicism. After all, this is a body which has been expanding steadily for at least 2,000 years, and faster than ever since 1949. 'There have been so many attempts. One can identify at least nine, and none succeeded. There were short-term cuts, but in the long term any streamlining was a failure,' said Professor John Burns of Hong Kong University, who has been studying closely the efforts made in the past five years. Zhu Rongji's incoming administration wants to cut the number of bureaucrats in the central Government by half, starting with the State Council, and to abolish 11 ministries, all in three years. In the plans outlined on Friday by State Council Secretary-General Luo Gan, there was a note of steely resolve. 'Organisational reform is a revolution,' he said. 'There will be obstruction and risks, but we have no other choice but to make the reforms. We will carry it out thoroughly.' The plan is instilling terror along the echoing corridors which house the heart of a bureaucracy whose tentacles now nurture a mind-numbing 37 million people. 'This is the most dramatic streamlining attempted by any Chinese government in 20 years,' said Dr Jean-Paul Cabestan, director of the French Centre on Contemporary China and the author of a detailed study on China's bureaucracy. 'Zhu is going to attract a lot of criticism,' he predicted. Many Chinese cadres who know of Mr Zhu's fearsome reputation think that this time it could be for real. 'Everyone's on the phone calling up their friends to look for a new job. There's a panicky feeling,' said one mid-ranking official in an industry ministry destined for demolition. Professor Richard Baum of UCLA thinks they have reason to be worried. 'I think the difference is that this time Zhu Rongji seems to have a rather clear mandate, a la Hercules, to clean out the Augean stables,' he said. 'This time, it appears, the iron rice bowl has actually been cracked open, and redundant state cadres will actually be eased off the payroll.' The Chinese communists set up a vast bureaucracy to manage a centrally planned economy where every activity was regulated and controlled by the state. When Mao Zedong lost confidence in the party bureaucracy after it turned against him in the wake of the Great Leap Forward famine, he set out to destroy it in the Cultural Revolution. The number of ministries was slashed from more than 100 to less than 30, and at times even fewer actually functioned. When Deng Xiaoping came to power, the bureaucracy immediately expanded again to more than 50 ministries and 100 ministerial level bodies because new organisations such as a statistical bureau or a patent office, unnecessary under Mao, had to be re-established. In 1982, then party secretary Hu Yaobang made an attempt with a bottom-up effort to weed out the Maoists, the elderly and the uneducated. He forced two million into retirement, but had to rehabilitate another three million who had been persecuted. Every incoming government has tried to cut and shape the bureaucracy to its liking. Under party secretary Zhao Ziyang, Hu's successor, the cost of supporting the new organisation began to be punitive. In just one year, 1988, the wage burden jumped by 20 per cent, as the market-oriented reforms required additional entities to function in addition to those which existed to serve central planning. One Chinese problem is that no one can ever be sacked because to become a state cadre is to have an iron rice bowl - a job for life. The pattern became fixed irrespective of the shifts in leadership, although under Li Peng the first attempts to break this tradition have been made. So far some 3,000 cadres have been dismissed. 'A winning faction adds its new people while the losing faction protects its networks,' explained Professor Edward Friedman of the University of Wisconsin. 'Given the iron rice bowl, the only possible method of downsizing is to speed up retirements and not permit replacements.' Mr Zhao tried to cut the number of bureaucrats in the State Council by around 20 per cent, but instead the numbers rose from less than 40,000 to more than 50,000, excluding ancillary and secretarial staff. Mr Li also tried and failed to cut the numbers. According to Ta Kung Bao, the number of personnel funded by the state has gone up by 82 per cent since 1978. China now has two or three times as many ministries and departments as other countries, with as many as 20 concerned only with the running of the economy. They are said to cost 360 billion yuan (HK$336 billion) a year, equal to 50 per cent of central Government spending. 'Overlapping and overstaffed government organisations lead to red tape, bureaucracy, corruption and unhealthy practices. It also brings heavy burdens to state finance,' Mr Luo said. Money is a big reason why China must savagely cut staff. 'Administrative expenses increased more rapidly than government revenue,' said Professor Burns. The central Government has found it difficult to force provincial governments to give it a bigger share of their tax revenues. 'Zhu Rongji's cuts are therefore going to start at the top, and this will force local leaders to cut the sister organisations at provincial, prefectural and county levels. In poorer parts of the country, local governments are already broke. Over a third of Hebei counties are not able to pay regular staff wages,' said Dr Cabestan. 'Some places have not been able to pay the wages for half a year, but it is hard to get a proper picture.' The second imperative is that as China shifts to a market economy it simply does not need so many bureaucrats. Much of what the state used to do will be accomplished by the private sector, and the state will not need to interfere so much. In 1988, Mr Zhao set out to create a British-style independent civil service separate from the Communist Party. This notion was hastily abandoned after Tiananmen Square, but in 1993 Premier Li set out his plans to cut the number of ministries by eight, to slash the number of bureaucrats by 25 per cent and reduce the size of the party's central organisations by 15 per cent. Mr Li also set out to re-organise the civil service with new grades and pay systems, and more importantly to begin the transformation of industry ministries into corporations. Mr Zhu's plans, as outlined by Mr Luo on Friday, are a continuation of this. However, Professor Burns thinks Mr Li's efforts have largely ended in failure, although much remains obscure. 'The bureaucracy has steadily increased in size rather than decreased,' he said. 'The number of officials working for central government officials went up by one million instead of falling by two million. The numbers in the Communist Party's central organs rose by 200,000 to 530,000. In the provinces the picture was much the same. But experts admit that so little information is available it is difficult to determine what is going on.' Dr Cabestan pointed out that the State Restructuring Commission still used the same figure of 33 million for the number of state employees as was given in 1987. Of this 33 million, about 10 million work as cadres in state-owned enterprises and another 11 million in education. Mr Luo spelt out few details in his speech, but said the Government would continue funding very few institutions, and he mentioned only education. For the rest, government funding will be cut by a third every year. 'They will have to depend on themselves,' Mr Luo said. Some, like the Sports Commission, are to be abolished altogether and are already on their way to becoming self-financing non-governmental organisations. The commission is going into business in a big way and has just raised over 240 million yuan by issuing shares on the Shanghai stock exchange. The big question, though, is whether the industry ministries have changed. Under Mr Li some, such as textiles, light industry and petroleum, are supposed to have undergone radical change. 'It is very difficult to find out what happened,' Professor Burns said. Many analysts suspect that even though they have been corporatised, they still behave like ministries in a command economy. This is partly because these are still, like China Telecom, more or less monopolies despite the existence of a small rival, Unicom. 'This is the question; do they behave like ministries? Do they operate in a different manner?' Dr Cabestan said. However, in his speech, Mr Luo tried to inject a note of determination by insisting the party was turning over a new leaf. 'In the past, our government controlled too many things which we should not care about or could not manage, and actually did not manage well,' he said. It is likely though that the transformation of another batch of ministries into Chinese-style Chaebols will reduce the number of cadres dependent on the state, if only by re-labelling officials. Managers in state-owned enterprises will no longer be counted as state cadres, as will officials working in the earmarked ministries. If the downsizing works, then China will become one of the most under-governed countries in the world. A mere three per cent of the population works for the government, compared to more like six per cent in some other countries. And for a population of 1,200 million, a central government staff of only four million is tiny. Yet many observers suspect that Mr Zhu,like so many before him, will be unable to alter the inherent nature of China's bureaucracy. 'There is a story going around that Li Peng called Zhu into his office in Zhongnanhai and said: 'I tried and failed. I hope you can do better' ,' said an Asian diplomat. 'And of course some people in the bowels of Zhongnanhai are privately hoping that Zhu fails, but for now they are keeping silent,' said Professor Baum.