By Editorial Board
Published: 2008-03-17
On March 11th, Chinese state councilor Hua Jianmin announced a government restructuring plan to the 11th National People's Congress (NPC), ending speculation on potential "super ministries", and officially kick-starting China's sixth administrative restructuring since 1982.

The reshuffle aims to streamline the State Council and cut redundancy in governmental institutions' functions. These objectives are reflected in the reorganization of the Ministry of Industry and Information, the Ministry of Transport, and the Ministry of Human Resources and Social Security.  

As anticipated, the State Environmental Protection Administration and the Ministry of Construction have been upgraded and restructured as the Ministry of Environmental Protection and the Ministry of Housing and Urban-Rural Construction respectively. The move is in line with the central government's increasing concern over environmental issues and the people's livelihood in recent years. 

Moreover, the National Development and Reform Commission (NDRC) will move away from its administrative and assessment work at the micro-level in order to focus on macro-economics control. This will pave the way for the widely-expected reform of separating the decision-making, implementation, and supervision functions within the Chinese government.  

We believe if successfully implemented, the reshuffle will to some extent prevent governmental agencies' from making diverse policies on the same issue or shirking responsibilities, and therefore improve government efficiency. However, there are still many unanswered questions regarding its implementation. 

For example, which agencies will undertake the functions scrapped off from the NDRC - like handling micro-issues? How will the NDRC, Ministry of Finance and central bank cooperate in implementing macro regulations? Will the NDRC's decisions hold more weight than the other two agencies, or will it be relatively independent? 

When it comes to energy resources management, is the planned National Energy Committee an entity on its own? Or is it a platform for multi-ministries to come together for coordination and consultation? What is its relationship to the Energy Administration under the NDRC? Compared to the model used in setting up the Antitrust Committee, which depended on various ministries and agencies to carry out implementation, the arrangement for the State Energy Committee to look after all energy related issues is more appropriate. 

Another concern is how the "Super Ministry of Communication", which manages certain transportation industries, will coordinate effectively with the Ministry of Railways, which remains independent? If faced with disasters like the snowstorm that took place around the Spring Festival, will the two separate entities cooperate and produce better results? 

On the other hand, the Ministry of Health will take over the National Food and Drug Bureau, which the public once hoped would perform like the US Food and Drug Administration. Following that, how will the MOH coordinate with the Ministry of Agriculture, the General Administration of Quality Supervision, Inspection and Quarantine, and the Administration for Industry and Commerce to ensure food and drug safety? 

After the reshuffle, some ministries and agencies that once enjoyed similar status or overlapping functions will be upgraded, demoted or combined. How will the rivalry between them come into play?   

Many problems remain. As Hua Jianmin said, owing to many difficulties and potential risks, the reform should be implemented step by step. Based on experience and lessons learned from the previous five reforms, we believe its success will hinge largely on having external pressure on the administration power.

As the central source of power, government institutions impulsively exert themselves and expand their influence; thus, relying on self-restraint and inter-administrations check-and-balance is unrealistic, as history has shown us.  

Therefore, we believe a truly effective administrative reform will require the government to open up further to market-oriented system and democracy, by granting the market and the people more power. This is the only way to ensure the success of any reform, including administrative restructuring.