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A more transparent system should be established to supervise how public money is spent, says a commentary in Oriental Morning Post. An excerpt follows:

The National Audit Office (NAO) announced on Wednesday last week the correction results of its 2004 audit. Government agencies have returned 4.16 billion yuan (US$520 million) of misappropriated funds, turned over 1.18 billion yuan (US$147 million) to the central budget and reallocated 11.76 billion yuan (US$1.47 billion).

According to the audit watchdog, 114 cases of suspected malpractice were discovered during the 2004 audit, leading to punishment of 213 officials and arrest, sentencing of 76.

In modern societies, systematic budgetary supervision should be conducted by the organ of power, the executive organ and the judicial organ. The organ of power should supervise the formulation of the budget. The judicial organ should prevent it from being embezzled or misappropriated through inspection and punishment. The executive organ should ensure the execution of budget according to law through the work of the audit office.

According to the Audit Law, NAO does not supervise the execution of budgets. So supervision from the audit department alone is not enough to ensure budgets are well executed. There is much work to be done.

First, an open information law should be made to ensure public supervision of budgetary fund circulation. The general public and media should be granted the right to conduct immediate supervision on the allocation and use of public money.

Second, an accountability system on the execution of budgets should be built.

Third, the Budget Law should be improved to mend loopholes. The law states that government at all levels can make flexible budgets, but the amount is too large and the use is without proper supervision.

(China Daily April 3, 2006)