September 19
Issued by the Ministry of Finance
About eight local governments
Notification of typical cases of implicit debt accountability
The Third Plenary Session of the 20th Central Committee of the Communist Party of China emphasized the need to coordinate development and security, and implement various measures to prevent and resolve local government debt risks. The Ministry of Finance will take the prevention and resolution of hidden debts as an important part of the 2023 special action on financial and accounting supervision, and seriously investigate and deal with violations of laws and regulations such as new hidden debts and untrue resolution of hidden debts (hereinafter referred to as "false debts"), and promote the accountability of relevant localities and departments in accordance with laws and regulations. In order to further tighten financial and economic discipline, give play to the role of warning and education, and resolutely curb the addition of new hidden debts, the eight typical cases of hidden debt accountability investigated and dealt with in the 2023 special action for financial and accounting supervision are hereby notified as follows:
1. Tianjin Port Free Trade Zone directly borrowed 7.397 billion yuan of implicit debts from local state-owned enterprises. From June 2018 to May 2023, according to the minutes of the meeting of the Standing Committee of the Party Committee of Tianjin Port Free Trade Zone, it was decided that the Tianjin Port Free Trade Zone Management Committee would borrow a total of 14.732 billion yuan from Tianjin Free Trade Zone Investment Holding Group Co., Ltd. and its subsidiary, Tianjin Tianbao International Logistics Group Co., Ltd., and all of them would be transferred to Tianjin Lingang Investment Holding Co., Ltd. to repay its existing debts. As of May 2023, the Tianjin Port Free Trade Zone Management Committee has returned 2.757 billion yuan to Tianjin Free Trade Zone Investment Holding Group Co., Ltd. and its subsidiary, Tianjin Tianbao International Logistics Group Co., Ltd., with a balance of 11.975 billion yuan. After deducting 4.578 billion yuan of existing debts used in the statistical monitoring system of local government implicit debts to "borrow new to repay the old", the remaining part formed a new implicit debt of 7.397 billion yuan. The Tianjin Municipal Commission for Discipline Inspection and the Tianjin Municipal Commission of Supervision are to organize the accountability of relevant responsible persons in accordance with discipline and regulations.
You Moumou, then secretary of the Working Committee (Party Committee) and director of the Management Committee of Tianjin Port Free Trade Zone, was given an intra-party warning;
Lv Moumou, then a member of the Working Committee and deputy director of the Management Committee of Tianjin Port Free Trade Zone, was given a government affairs warning;
Bi Moumou, then deputy secretary of the Party Committee of Tianjin Port Free Trade Zone, was criticized and educated and ordered to conduct a thorough inspection;
Hong Moumou, then Secretary of the Party Committee and Director of the Management Committee of Tianjin Port Free Trade Zone, was criticized and educated and ordered to conduct a deep inspection;
Kou Moumou, then member of the Party Committee and deputy director of the Management Committee of Tianjin Port Free Trade Zone, was criticized and educated and ordered to conduct a deep inspection;
admonished Zhao Moumou, then Secretary of the Party Committee of Tianjin Free Trade Zone Investment Holding Group Co., Ltd. and member of the Standing Committee of the Party Committee of the Free Trade Zone;
The other persons involved were dealt with as well.
2. Bayuquan District, Yingkou City, Liaoning Province, borrowed 1.996 billion yuan of hidden debts from local state-owned enterprises. From 2022 to June 2023, according to the "Memorandum on Debt Resolution and Raising Funds" issued by the Bayuquan District Government of Yingkou City, the Finance Bureau of Bayuquan District of Yingkou City borrowed 1.537 billion yuan from local state-owned enterprises and 459 million yuan from other enterprises, and included all the loans into the special urban construction account for overall use, forming a new hidden debt of 1.996 billion yuan. The Liaoning Provincial Commission for Discipline Inspection and the Liaoning Provincial Supervision Commission of the Communist Party of China are to organize the accountability of relevant responsible persons in accordance with discipline and regulations.
admonished Meng, then deputy secretary of the Bayuquan District Party Committee and head of the district;
Guan Moumou, then deputy secretary of the Bayuquan District Party Committee and head of the district, was given a government affairs warning;
Qu Moumou, then member of the Standing Committee of the Bayuquan District Party Committee and deputy head of the district, was given a demerit sanction for administrative affairs;
Xu, then director of the Bayuquan District Finance Bureau, was given a major punishment of administrative demerit;
Zhou, then director of the Bayuquan District Financial Affairs Center, was given a demerit sanction;
criticized and educated Liu Moumou, then general manager of Huayuan Thermal Heating Co., Ltd. in Yingkou Economic and Technological Development Zone;
criticized and educated Yan, then general manager of Yinggang Heating Co., Ltd., Bayuquan District, Yingkou City;
criticized and educated Yu Moumou, then director of the Urban Renewal Security Center of Bayuquan District, Yingkou City;
The other persons involved were dealt with as well.
3. Hunan Provincial Public Vocational Schools have added 450 million yuan of hidden debts by renting instead of building. In November 2018, Hunan Petrochemical Vocational and Technical College decided to cooperate with Yueyang Xiangnu Culture and Education Development Co., Ltd. to build a new campus by renting instead of building, and repurchased it by paying rent of 12.33 million yuan per year and entrusting the operation of the three industries (including the new and old campuses), with a term of 30 years, a total amount of 450 million yuan, and a new hidden debt of 450 million yuan. The Hunan Provincial Commission for Discipline Inspection and the Hunan Provincial Supervision Commission of the Communist Party of China are to organize the accountability of relevant responsible persons in accordance with discipline and regulations.
Lei Moumou, then Secretary of the Party Committee of Hunan Petrochemical Vocational and Technical College, was given a serious warning within the party;
Xu, then deputy secretary of the Party Committee and vice president of Hunan Petrochemical Vocational and Technical College, was ordered to make a written inspection;
Liu, then a member of the Party Committee of Hunan Petrochemical Vocational and Technical College and commander-in-chief of the project department, was given an intra-party warning;
gave criticism and education to Sun, then vice president of Hunan Petrochemical Vocational and Technical College;
Guo Moumou, then vice president of Hunan Petrochemical Vocational and Technical College, was criticized and educated;
Liu Moumou, then a member of the Party Committee of Hunan Petrochemical Vocational and Technical College, was reminded to talk.
4. Dongxiang District, Fuzhou City, Jiangxi Province, borrowed 340 million yuan of hidden debts through local state-owned enterprises. From March to December 2022, the Finance Bureau of Dongxiang District, Fuzhou City, in the name of returning capital reserves, transferred 340 million yuan of financing funds from two state-owned enterprises in Fuzhou City, Dongxiang District Industrial and Technological Innovation Investment Group Co., Ltd. and Fuzhou Dongxiang District Urban Investment Development Co., Ltd., for overall use, forming a new hidden debt of 340 million yuan. The Jiangxi Provincial Commission for Discipline Inspection and the Jiangxi Provincial Supervision Commission of the Communist Party of China are to organize the accountability of relevant responsible persons in accordance with discipline and regulations.
admonished Li Moumou, then deputy secretary of the Dongxiang District Party Committee and head of the district;
Li, then member of the Standing Committee of the Dongxiang District Party Committee and executive deputy head of the district, was given an intra-party warning;
Zhu Moumou, then secretary of the party group and director of the Dongxiang District Finance Bureau, was given a serious warning within the party;
ordered a written inspection of Liu Moumou, then chairman of Fuzhou Dongxiang District Industrial and Technological Innovation Investment Group Co., Ltd.;
admonished Chen Moumou, then chairman of Fuzhou Dongxiang District Urban Investment Development Co., Ltd.;
The other persons involved were dealt with as well.
5. Meihekou City, Tonghua City, Jilin Province, with public hospitals as the main body of loans, added 298 million yuan of hidden debts. In December 2020, according to the minutes of the meeting of the Meihekou Municipal Government, the former Meihekou Central Hospital (now Meihe Hospital of the First Hospital of Jilin University) borrowed from Tonghua Meihekou Branch of Bank of Jilin Co., Ltd. in the name of supplementing operating funds, and transferred 298 million yuan to Meihekou Caiyuan Investment Co., Ltd. Among them, Meihekou Caiyuan Investment Co., Ltd. used 159 million yuan to purchase state-owned assets, and the proceeds from the sale were handed over to the municipal finance by Meihekou State-owned Assets Management Co., Ltd., and the rest of the funds were also transferred to the Meihekou City Finance Bureau for overall use. The actual repayment of principal and interest on the above-mentioned loans was borne by the financial authorities, resulting in an additional hidden debt of 298 million yuan. The Jilin Provincial Commission for Discipline Inspection and the Jilin Provincial Supervision Commission of the Communist Party of China are to organize the accountability of relevant responsible persons in accordance with discipline and regulations.
Wang Moumou, then secretary of the Meihekou Municipal Party Committee, was given a government affairs warning;
admonished Wang, then member of the Standing Committee of the Meihekou Municipal Party Committee and deputy mayor;
Sun Moumou, then Secretary of the Party Group and Director of the Meihekou Municipal Finance Bureau, was given a government affairs warning;
admonished Hu Moumou, the legal person of Meihekou Juyuan Investment Co., Ltd. and Meihekou Chuangyuan Development and Investment Co., Ltd.;
criticized and educated Li Moumou, then president of Meihekou Central Hospital;
The other persons involved were dealt with as well.
6. Baotou City, Inner Mongolia Autonomous Region, borrowed money from the Financial Leasing Co., Ltd. to repay the existing hidden debts and treated them as debts, resulting in false debts of 68 million yuan. From September 2018 to December 2019, Baotou Light Industry Vocational and Technical College borrowed from Far East Horizon Financial Leasing Co., Ltd. and Ping An International Financial Leasing Co., Ltd. to repay 20 stock implicit debts of RMB 68 million, including training buildings and ancillary facilities projects, and treated them as debts in the local government implicit debt statistical monitoring system, resulting in false debts of RMB 68 million. The Mongolia Autonomous Region Discipline Inspection Commission and the Autonomous Region Supervision Commission of the Mongolia Autonomous Region of the Communist Party of China are to organize the accountability of relevant responsible persons in accordance with discipline and regulations.
gave a conversation reminder to Zhang Moumou, then director of the Baotou Municipal Finance Bureau;
Qi Moumou, deputy director of the Baotou Municipal Finance Bureau, was criticized and educated and ordered to make a written inspection;
Li Moumou, then the head of the debt management office of the Baotou Municipal Finance Bureau, was given an intra-party warning;
Wang, then head of the debt section of the Baotou Municipal Finance Bureau, was given an intra-party warning;
criticized and educated Ren Moumou, then president of Baotou Light Industry Vocational and Technical College, and ordered a written inspection;
criticized and educated Xue, then vice president of Baotou Light Industry Vocational and Technical College, and ordered a written inspection;
The other persons involved were dealt with as well.
7. Lingao County, Hainan Province, requires the agent bank to advance payment and has not been liquidated for a long time, and the new hidden debt is 840 million yuan. From November to December 2022, the Lingao County Finance Bureau violated the regulations of local financial departments that prohibit agency banks from deferring liquidation and advancing funds for a long time, and in accordance with the communication opinions with Industrial and Commercial Bank of China Co., Ltd. Lingao Branch, Agricultural Bank of China Co., Ltd. Lingao County Branch, China Construction Bank Co., Ltd. Lingao Branch, and Hainan Lingao Rural Commercial Bank Co., Ltd., requested the above banks to postpone liquidation and advance 840 million yuan in violation of regulations. As of the end of December 2022, the Lingao County Finance Bureau has not liquidated the long-term advance funds, forming a new hidden debt of 840 million yuan. The Hainan Provincial Commission for Discipline Inspection of the Communist Party of China, the Hainan Provincial Supervision Commission, and the State Administration of Financial Supervision and Administration are to organize the accountability of relevant units and responsible persons in accordance with discipline and regulations.
Tang Moumou, then deputy secretary of the Lingao County Party Committee and county magistrate, was criticized and educated, and ordered to make a written inspection and report;
gave an admonition to Li Moumou, then member of the Standing Committee of the Lingao County Party Committee and deputy county magistrate;
Pang Moumou, then director of the Lingao County Finance Bureau, and Wang Moumou, deputy director of the bureau, were given administrative warnings;
admonished Luo, then director of the Treasury Office of the Lingao County Finance Bureau;
imposed a fine of 450,000 yuan on the Lingao Branch of Industrial and Commercial Bank of China Co., Ltd.;
imposed a fine of 450,000 yuan on the Lingao County Branch of Agricultural Bank of China Co., Ltd.;
imposed a fine of 450,000 yuan on the Lingao Branch of China Construction Bank Corporation;
Guo, then president of the Lingao branch of the Industrial and Commercial Bank of China Co., Ltd., and Xie Moumou, vice president in charge, were given warnings;
Wang Moumou, then president of the Lingao County Branch of Agricultural Bank of China Co., Ltd., and Wen Moumou, vice president in charge, were given warnings;
Guo Moumou, then president of the Lingao branch of China Construction Bank Corporation, was given a warning.
8. The state-owned enterprises in Yongning County, Yinchuan City, Ningxia Hui Autonomous Region, added 320 million yuan of hidden debts to the pledge financing of rural drinking water and agricultural irrigation concessions. In March 2023, in accordance with the "Implementation Plan for the Rural Drinking Water and Agricultural Irrigation Franchise Project in Yongning County" deliberated and approved by the executive meeting of the Yongning County Government, the Yongning County Finance Bureau and Yongning County Fengyuan Agricultural Development Co., Ltd. signed the "Yongning County Rural Drinking Water and Agricultural Irrigation Franchise Project Asset Transfer Agreement" and the "Yongning County Rural Drinking Water and Agricultural Irrigation Franchise Project Franchise Agreement" to transfer the Yongning County Rural Drinking Water and Agricultural Irrigation Franchise Rights to the company. Yongning County Fengyuan Agricultural Development Co., Ltd. and Agricultural Development Bank of China Yongning County Branch signed the "Right Pledge Contract", borrowing 320 million yuan for a period of 20 years, for Yongning County Rural Drinking Water and Agricultural Irrigation Franchise Project, the annex to the "Rights Pledge Contract" contains the "Instructions on the Budget Funds Related to the Rural Drinking Water and Agricultural Irrigation Franchise Project in Yongning County" issued by the Yongning County Finance Bureau, the debtor of the right to pledge. It is promised that during the concession period, the water charges paid by agricultural irrigation to the main canal and the renewal and maintenance costs of rural drinking water and agricultural irrigation equipment will be fully included in the budget, forming an additional hidden debt of 320 million yuan. The CPC Ningxia Hui Autonomous Region Commission for Discipline Inspection, the Ningxia Hui Autonomous Region Supervision Commission, and the State Administration of Financial Supervision and Administration are to organize the accountability of relevant units and responsible persons in accordance with discipline and regulations.
criticized and educated Zhu, then secretary of the Yongning County Party Committee;
gave a government affairs warning to the then county magistrate of Yongning County;
Huang Moumou, then executive deputy county magistrate of Yongning County, was given a government affairs warning;
Xie Moumou, then director of the Finance Bureau, was given an administrative demerit sanction;
criticized and educated Bai Moumou, then director of the Yongning County Housing and Urban-Rural Development Bureau;
Qu Moumou, then chairman of Yongning County Fengyuan Agricultural Development Co., Ltd., was given a government affairs warning;
Tang Moumou, then general manager of Yongning County Fengyuan Agricultural Development Co., Ltd., was given a demerit sanction;
imposed a fine of 500,000 yuan on the Yongning County Branch of the Agricultural Development Bank of China;
gave a warning to Wang, then vice president (temporary person in charge) of the Yongning County Branch of the Agricultural Development Bank of China;
The other persons involved were dealt with as well.
The above eight typical cases have exposed that there are deviations in the outlook on the performance of leading cadres in some localities and units, and that the concept of discipline is not strict, and in the implementation of the decisions and arrangements of the Party Central Committee and the State Council, there are orders that are not carried out, prohibitions are not followed, discounts are made, and adaptations are made, which seriously affects the effectiveness of the work of preventing and resolving hidden debt risks. The serious accountability of the relevant responsible persons fully demonstrates the strong determination and firm will to hold the hidden debt problem accountable for life and to investigate the responsibility. All localities and units should profoundly draw lessons from the typical cases circular, draw inferences from others, and take them as a warning. It is necessary to earnestly improve the political position, enhance the "four consciousnesses", strengthen the "four self-confidences", and achieve the "two safeguards", resolutely implement the deployment of the Party Central Committee and the State Council, take the prevention and resolution of hidden debt risks as an important political discipline and political rules, always establish risk awareness and bottom-line thinking, resolutely curb the increase of hidden debts, and properly dispose of and resolve the stock of hidden debts. The Ministry of Finance will earnestly fulfill its main responsibility for financial and accounting supervision, and will continue to strengthen the investigation and accountability of hidden debts and effectively prevent and resolve hidden debt risks for violations of laws and regulations such as new hidden debts and false debts.
Source: Ministry of Finance website of the People's Republic of China