A Practical Report Focusing on People's Livelihood

Hu Min, Research Fellow

A Practical Report Focusing on People's Livelihood

Hu Min, Research Fellow

Central Party School (State Administration College)

The report on the work of the government for the NPC session in 2020 is very unusual. This report on the work of the government is given in an extraordinary period.

Affected by the novel coronavirus outbreak, the sessions for both the NPC and the CPPCC, were planned to be held in early March, but extended to late May. The outbreak has unprecedented impacts on China's economic and social development, and brought unprecedented challenges. This year's report on work of the government must comprehensively take into account the current and future new situations at home and abroad, and make timely and proper adjustments to the planned targets and work arrangements before the outbreak.

In the face of extremely complex situation, how can we promote epidemic prevention and control as well as economic and social development as a whole, how to achieve the goal of poverty alleviation and moderately prosperous society in all respects in just more than half a year, how to determine the annual economic and social development goals and tasks under the normal epidemic prevention and control situation, and how to turn the crisis into an opportunity to cope with the more uncertain world economic pattern, etc., all the attention is focused on this year's report on the work of the government.

Although this year's report on the work of the government is short, its content is still heavy-loaded. The most distinctive feature is that it grasps the word "pragmatic", highlights the word "people", responds to the concerns of all sides, and is a practical report that highlights the people-orientated livelihood.

Grasping the word "pragmatic": facing up the difficulties and challenges, focusing on the current situation with a long-term plan

One of the most important points of this report is that it does not set a specific target for economic growth in 2020. Premier Li Keqiang pointed out in the report that we did not set a specific target for annual economic growth, mainly because the global epidemic situation and economic and trade situation were uncertain, and China's development was facing some unpredictable factors and doing so would help guide all sides to focus on the "six stability" and the "six guarantees". This is realistic.

In fact, proposing no specific economic growth indicators will also help us to firmly establish a new concept of development, not only give no top priority to GDP figures, but also genuinely change the mode of economic development. If there is a figure to set the standard, it is unavoidable for many localities to inevitably raise the quota at each level and engage in accounting only, or even in falsification to form a new formalism. At present, under the circumstances of the normal epidemic prevention and control, we must focus on resuming work and production, smoothing the economic and social cycle so as to ensure stability and progress, keep the bottom line and stabilize economic operation. In the long run, in the face of China's economy changing from a high-speed growth stage to a high-quality development stage, we must adhere to the principle of quality first and efficiency first, and take the supply-side structural reform as the main line to promote the quality, efficiency and driver transformation in economic development. We must not go back to the beaten track of simply giving priority to heroic economic growth figure, to the so-called development at the expense of destroying the environment, or even to the model of extensive development. The epidemic situation is a great test for us in a major battle field, so from the perspective of economic work, on one hand, we should do well in implementing the "six stability" and the "six guarantees" to minimize the losses caused by the epidemic outbreak; on the other hand, we should take the initiative to turn a crisis into an opportunity, turn passivity into initiative, change the thinking of digital growth only and go all out to improve the quality of development, which is also a historical opportunity to deal with the challenges of pandemic. Whether to implement epidemic prevention and control or to adapt to the post-epidemic era, we must find a new way to effectively respond to the impact and achieve a virtuous economic and social cycle.

Objectively speaking, with the long-term efforts since the reform and opening up, China's economic strength has greatly leaped, and people's livelihood has been significantly improved. Now the main problem is to focus on the key points, make up for the short-board, and strengthen the weak links. The COVID-19 outbreak also reveals that we still have many deficiencies in infrastructure and public services. We must firmly grasp the new development concept to promote development and focus on solving problems of various unbalances and inadequacies. Therefore, to give less attention to the growth rate and grasp the quality of development is to follow the law of economic and social development, and is the basis to do economic work well.

Of course, setting no specific annual economic growth indicators does not mean that economic growth is not important at all. In fact, macroeconomic operation is a system, and economic growth indicators are also a system. This year's government work report, aiming at the impact of the epidemic outbreak on the national economy, still puts forward some specific indicators such as the annual urban new employment rate, urban surveyed unemployment rate, urban registration unemployment rate, consumer prices control, etc., as well as maintaining the basic balance of international payments, and basically keeping the growth of residents' income in step with the economic growth; under the current standard, all the rural poverty-stricken people are lifted out of poverty, and all the poverty-stricken counties discard their label; effective prevention and control of major financial risks; continuous reduction of energy consumption per unit of GDP and emission of major pollutants. These indicators and requirements are to keep employment, price and market stability; regarding the people's livelihood, highlighting the people-oriented livelihood, achieving a good foreign trade situation, ensuring the stability of the industrial chain and supply chain, improving quality and efficiency, and focusing on stable economic operation. After the hard efforts, these indicators can be completed to the maximum extent, that is, to provide strong economic support to ensure the realization of the annual economic and social development under the epidemic situation.

Focusing on the word "people": highlighting people-oriented livelihood and defending bottom line of people's livelihood

We can see the prominent people-oriented livelihood focused in this year's government work report. It is not hard to find that all macroeconomic policies are to guarantee the main part of market and the employment, which is to ensure people's livelihood.

It can be seen that the three macro-policies of finance, money and employment are all orientated toward the people. In terms of fiscal policy, this year's deficit rate is planned to set at over 3.6%, which is 0.8% higher than last year's 2.8%, the scale of fiscal deficit is 1 trillion yuan RMB more than last year, and 1 trillion yuan of special national epidemic prevention bonds is also issued. This is a special measure in a special period and is also expected by the market.

How to use the two trillion yuan RMB increased? All funds should be transferred to local governments, special transfer payment mechanisms should be established, and these funds should go directly to the basic level of city and county to benefit enterprises and people, and are mainly used to protect employment, people's basic livelihood and main market entities. In addition, basic expenditures for people's livelihood will only increase but not decrease, and expenditures in key areas will be guaranteed. This includes further strengthening tax reduction and fee reduction to help the main market entities overcome difficulties for development. Besides, another 500 billion yuan of tax and fee reduction will be added this year, which is expected to reduce the burden on enterprises by more than 2.5 trillion yuan in the whole year. We should resolutely perform the policy of tax and fee reduction on enterprises, keeping the green mountains and winning the future.

In terms of monetary policy, we need to make comprehensive use of such means as reducing interest rates and re-financing to guide the growth of broad money supply and social financing scale significantly higher than last year. This also serves the real economy, especially the small and medium-sized micro-enterprises that are short of capital. We should also innovate monetary policy tools that can directly reach the real economy, promote facilitation access for enterprises to get loans, and push interest rates to continuously decline so as to reduce the financing costs of enterprises.

Fiscal, monetary and investment policies should also focus on supporting employment stabilization and promoting employment priority policies to be more comprehensively strengthened. According to the government work report, efforts should be made to stabilize the existing jobs, actively increase new employment and promote the reemployment of the unemployed. All localities should clear up and eliminate unreasonable restrictions on employment, make full use of measures to promote employment, and make the best use of methods to increase jobs.

In terms of policies on expanding consumption and promoting effective investment, we should deepen supply side structural reform, highlight the people-orientated livelihood, effectively combine promoting consumption with expanding investment, increase income and ensure people's livelihood through stable employment, and improve the willingness and ability of residents to consume. For example, this year, there will be 39,000 old urban communities to be renovated, we should support their installation of elevators, the development of various community services such as dining and cleaning, so as to expand demand with effective investment. Again for example, we will give full play to the comprehensive driving role of central cities and urban agglomerations, cultivate business, increase employment, improve convenience facilities for residents, and make cities more suitable for business and living. We need to continue to deepen the reform of "deregulation, management and service", remove institutional and mechanism barriers, rely on reform to stimulate the vitality of market players, and enhance new momentum for development.

Social policies have concentrated more on people's livelihood. The work report points out that in the face of difficulties, we should firmly hold the bottom line of basic people's livelihood and work hard to handle well the issues of concerns to the masses. This year, we will vigorously strengthen the construction of the public health system and resolutely safeguard people's health; the per capita financial subsidy standard for residents' medical insurance will be increased by another 30 yuan this year, and we will launch pilot projects of cross-provincial direct settlement of outpatient expenses. We will raise the basic pension for retirees and the minimum standard for basic pension for urban and rural residents as well. Nearly 300 million people across the country must receive their pensions on time and in full; we must ensure the basic livelihood of all the people in need, and guarantee people's livelihood to help more unemployed people find jobs or start business.

At the same time, the government work report requires governments at all levels to be strictly tight economically, and to reduce over 50% of non-urgent and non-planned expenditures. All kinds of surplus and deposited funds should be collected, all expenditures should be calculated carefully, every sum of money must be used for the most important place, and assure the market entities and the people to feel pragmatically and tangibly.

No matter how big the difficulties are, as long as we always adhere to the people-centered policy and work hard with the people, we will be able to overcome them all. We firmly believe that China's development will be full of hopes and that the aspirations of the Chinese people for a better life will be realized.

(Edited excerpts of the article in guangming.com May 25, 2020.)