A Review on the Theoretical Study of “Basic Public Services” in China and A Study of the Issues on Equalisation for the Provision of Basic Public Services in China - 中欧社会论坛 - China Europa Forum

A Review on the Theoretical Study of “Basic Public Services” in China and A Study of the Issues on Equalisation for the Provision of Basic Public Services in China

Abstract

Authors: Liu Wei, Lu Wei, Wang Weitong

Published by Review of Economic Research (2010, No. 16 (Total No. 2288) and 2008, No. 34 (Total No. 2162)

I. The basic meaning of public services

1. To understand it in terms of the nature and function of the government. In addition to economic regulations, market supervision and social management, all the things that are done by the government are public services.

2. To define it from the perspective of tangible and intangible. Public services are intangible consumer services provided by the government

3. To analyse it from the broad perspective of public goods. They refer to the products and services of common consumer nature.

4. To explain it from the perspective of direct demand. Those which can meet the needs of both residents and organisations directly are public service.

5. To understand it in terms of equalisation. The government makes use of the public authority or public resources, to promote the equalisation of residents’ basic consumption, through the public behaviour of residents’ consumption risk sharing. (“The Equalisation of Basic Public Services and Public Financial System,” by Liu Shangxi, Yang Yuanjie, Zhang Xun, Review of Economic Research, 2008, No. 40 (Total No. 2168))

II. The basic definition of public services

1. To define it from the scope of public services. Public services must be built on the basis of a certain social consensus, according to the stage of socio-economic development and the overall level, to maintain socio-economic stability, basic social justice and social cohesion in China, to protect individuals’ fundamental rights to survival and development. These are the features that public services must provide (Chen Changsheng, 2007). This includes protection relief, security for the elderly, free basic education and public demand for a basic public culture (Lu Wei, Wang Weitong, 2008).

2. To define it from the perspective of people’s livelihood needs. Medical and health care, compulsory education, social relief, employment services and security for the elderly (Ding Yuanzhu, 2008), are all pure public services closely related with the livelihood of people (An Tifu, 2007).

3. To define it from the nature of public welfare and the degree of management. It is the public goods and services that the government must commit and satisfy, and it must be provided by the government, in order to offer adequate security to effectively meet the basic welfare standards in society (Xiang Jiquan, 2008).

4. To define it from the scope of consumer needs. From the perspective of consumer needs, public services are directly related to low levels of consumer needs; from the view of the homogeneity of consumer needs, there is no difference in consumption (Liu Shangxi, 2007).

5. To define it from the scope of government functions. Public services including employment services, social security, social welfare and social assistance, public development services; basic environmental services; basic security services (Cheng Haiwei, 2007).

6. To define it from the scope of relevant policies. Public services including education, culture, employment and reemployment, social security, ecological environment, public infrastructure and social order (“Decisions by the Central Committee of the CPC on Some Major Issues in Building a Harmonious Socialist Society”, 2006).

III. The equalisation of basic services

1. The equalisation of basic public services are equal opportunities for all citizens, the results are generally the same, to respect the right of free choice of members in society; and to control the gap between basic public services in the context of which the community can afford; equalisation of basic public services should pay particular attention to disadvantaged groups.

2. The equalisation standards: the minimum standard is the necessity to break even; the average standard is to reach moderate level; relative standard is the result of equality.

3. The equalisation modes: vast regional equality, in accordance with similar principles of economic development or revenue capacity, first achieve equality within the region, then re-adjust regional disparities; the equal bottom line, according to the national stage of development and the financial resources of government, sets the minimum standards. Provinces below the minimum standard will be filled in by the vertical and horizontal transfer of payment; whereas provinces exceeding the standard will provide services above the minimum standard, and should subsidise those provinces that cannot meet the minimum standards.

4. The determination of equal standards: measured by per capita expenditure of the public services, that is “standard human needs”, which indicates the actual amount of basic public services that a standardised citizen should enjoy. The determination is analysed from the three angles of international comparison (by integrating our current level of economic development and fiscal capacity, and comparing the public service expenditures of the other countries internationally), the domestic value (by selecting provinces with a more moderate level of economic development and public services delivery, based on the equalisation of the level of service provided; calculate the regression on the areas of public service expenditure level, regional economic development and financial capacity and other factors, correlated with the fitting demand curve, and then incorporated into the regional economic development and our average financial capacity in value, measured out the moderate level of equalisation of services), government capacity (to consider the actual public service delivery capacity of the government, based on the actual income and expenditure by the government, and synthetically consider the various government functions.)

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