A number of senior cadres want to extend the deadline for turning around loss-making state firms by seven years. Premier Zhu Rongji's famous slogan about 'curing ailing enterprises in three years', first raised last year, has seldom been mentioned in the media recently. Relatively conservative officials, including President Jiang Zemin, are inclined towards extending the period for restructuring state-owned firms to 10 years. A Beijing source said yesterday Mr Jiang had, in private meetings, pointed out a more gradualist model for enterprise reform would help maintain stability. Mr Jiang and his aides indicated that should Beijing join the World Trade Organisation in the coming year or so, it would be better for state firms to have an adequate period to absorb the shock. They also claimed that it was 'unscientific' to lay down specific targets for enterprise performance because whether a firm earned money or not depended on factors such as business cycles and global market conditions. During meetings held in the regions to study Mr Jiang's instructions on enterprise reform, emphasis has been put on ensuring the dominance of state firms in 'strategic' sectors, including those affecting national security. The Beijing source said supporters of Mr Zhu feared the pace of reform had been slowed down as the Premier lost effective control over enterprise restructuring. Several of the Premier's proteges who have been active in enterprise reform have been sidetracked. They include the State Council Secretary-General, Wang Zhongyu, and the head of the State Economic and Trade Commission, Sheng Huaren. Meanwhile, Mr Zhu's aides are studying a new policy to beat deflation and boost consumer spending. An economic source said the policy consisted of engineering mild inflation through means such as boosting some government fees and charges. 'When they see prices rising, consumers may start taking money out from banks and spend,' the source said. However, it is understood Mr Zhu and his advisers will only push this strategy when they are convinced it will not bring back the hyper-inflation of the early 1990s. In the past year, Beijing has used methods including interest-rate cuts and taxing bank-deposit earnings in order to stimulate consumer spending, but with little success.