2008 Finalist
Huinan Town, Nanhui District, Shanghai
Innovations and Excellence in Local Chinese Government
Innovations and Excellence in Local Chinese Government

This program was a nominee for the "Local Government with Best Sense of Responsibility Award."

In October 2003, Huinan Town in the Nanhui District of Shanghai began a Public Budgeting System Reform to provide equal access to public services and solve problems such as imbalanced development resulting from town mergers. The system was designed to obtain budget input from residents and transfer decision-making power from government to the local People's Congress for projects closely related to people's livelihoods. In July 2007 the People's Congress institutionalized this budgeting system by enacting "Measures for the Implementation of Beneficial Projects of Huinan Town." These regulations ensure that 15 percent of the total township budget is allocated through this system and that the public is kept informed of the process and results.

This budgeting system combines informed decision-making with direct project supervision. Beginning in mid-October of each year, the People's Congress, the government of Huinan, and villagers' autonomous organizations collect suggestions for projects through questionnaires, meetings, and forums. The government classifies and sorts suggestions that are feasible within budget allocations. It then drafts budgets for the project proposals. The budgeted proposals are called the "proposal menu." This "menu" is submitted to a local People's Congress. People's Congress Deputies select projects for implementation in a process called "ordering" projects. The government then implements the "ordered" projects and People's Congress Deputies, together with the Chairman and Vice-chairman of the Congress, make spot inspections, supervise implementation, evaluate, and assess the results obtained. Each year the government also delivers a special report to the People's Congress on achievements.

As demonstrated by the projects implemented during 2004 to 2007, the reform allows Deputies to be more responsive to the people's interests and allows them to respond to people's demands in a timely manner. The People's Congress collected over 700 suggestions during this period, included 82 of these projects in the "proposal menu," and "ordered" 42 at a cost of 0.2 billion Yuan. (28.5 million USD)

In the previous governance decision-making model, government and party leaders had the final say on projects that would be implemented. Now, the base of local government decision-making consists of residents and People's Congress Deputies. Because the public more readily participates in the political process, this system has improved both the formal and information communication channels. Deputies now have closer contact with the public in a proactive and voluntary manner. Experts and scholars, especially those from Shanghai, highlighted the importance and value of this reform and played a crucial role in bringing it about. Finally, this reform was very easy to implement and could be easily replicated in other regions.

Improvements in the "Public Budgeting System Reform" can still be made by:

  • Strengthening capacity building. People's Congress Deputies would benefit from specialized training to improve their ability to collect/ sort information and accurately assess the feasibility of projects,
  • Implementing additional channels for the public to express their concerns, and
  • Developing regional coordination mechanisms to equalize public service delivery in across the region.