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Publication Date : 25-12-2013
Policy aims to end abuse of housing perks
Over the years, senior Chinese officials have been granted access to government housing during their term of office. But in recent years, some have overplayed their hands by abusing the system, and their excessive housing perks have caused public resentment and consternation. In the roll call of fallen officials, much of the graft has revolved around the government housing system.
To curb official corruption related to housing and end extravagance, China will "explore ways to implement an official residence system", according to one of the proposals in a wide-ranging reform blueprint approved at a key Party meeting in November.
The notion of "an official residence system", albeit with few details so far, quickly caught the interest of the public, as people speculated about how such a reform would impinge upon vested interests.
Thirty years ago, most officials shared similar accommodation. The long-fostered image of modest two-story red-brick houses set among trees and lawns with a fishpond in the centre may be overly sentimental, but it fundamentally reflects the accommodation available to government officials about 30 years ago, in the early days of the reform and opening-up policy.
Things have changed dramatically since then. In October, China Economic Weekly reported that approximately 100 senior officials at provincial or ministerial rank have fallen from grace since 2000. Of those, 53 were involved in bribery and corruption related to housing.
In July, Liu Zhijun, the former railway minister, received a suspended death sentence after being found guilty of the abuse of power and accepting bribes, but what shocked the public most was Liu's admission that he had amassed 374 houses, some in Beijing, others spread around the country.
Meanwhile, Cai Bin, a senior urban-management official in Guangzhou, Guangdong province, widely known by the nickname "Uncle House", was found to have corruptly acquired more than 20 houses. Shortly after "Uncle House" was exposed, a "Sister House" and an "Auntie House" appeared.
At a time when the life savings of an ordinary citizen are far from enough to buy a house, repeated scandals concerning official corruption have prompted the authorities to overhaul the official housing system.
On December 11, the country's anti-corruption watchdog gave the first detailed definition of the proposed new regime. The CPC Central Commission for Discipline Inspection said China will establish a system under which the government will arrange houses for senior officials, their spouses and children during their tenure of office. However, the officials will be required to hand back the properties when they leave their posts, so that they can be allocated to their successors.
Some experts believe the move constitutes a major breakthrough in the leadership's fight against corruption, while others remain skeptical.
Some members of the public have even suggested that the changes will simply provide more perks for the officials.
According to Wang Yukai, a professor of political reform and E-governance at the Chinese Academy of Governance in Beijing, "setting up an
official residence system is a fundamental move to prevent officials from trading their power for wealth".
Wang has led research projects into the accommodation provided for officials, the official residence system in ancient China, and current practices abroad. His reports on implementing an official residence system in China were presented to the government in July.
Exploiting the gray areas
As evidence of graft, he cited a current example from an official residence complex in an unnamed province. Only 28 per cent of the houses in the complex were being used by incumbent officials, while the relatives of retired cadres accounted for 59 per cent and the relatives of cadres
who had been transferred to other localities accounted for 7 per cent. The other two houses in the complex were too dilapidated to be occupied.
In under-regulated gray areas such as this, some local governments have bought prime real estate and donated apartments to newly arrived senior officials. Media reports have also disclosed purchases of clusters of villas.
When cadres are parachuted into posts in different localities, they are assigned new houses, but a lack of supervision and lax regulation mean they often make the properties their own by simply adding them to their personal portfolios.
"That sort of thing is not uncommon," said Wang. "These 'adoptions' reflect the exorbitant housing privileges enjoyed by officials and the resultant loss of public assets."
As a check against nepotism and corruption, officials are constantly reshuffled and moved around the country, but ironically the system provides the perfect conditions for them to amass property.
According to Yan Jirong, a political expert at Peking University's School of Government, "some corrupt officials get new houses when they take office in a new area, but they don't move out of the house assigned to them in their previous job. Thus, if they are transferred frequently, they can accumulate a lot of property."
Some officials pass their government houses onto their children when they leave office, or they sell or rent the properties on the open market, making large profits.
Wu Hui, an associate professor of governance at the Party School of the CPC Central Committee, said the extravagance and corruption displayed by some officials with respect to property have "tainted the image of Party cadres and government officials in the eyes of the public".
"The idea of an official residence system has an historical precedence. In ancient China, local bureaucrats and their immediate families lived in a residence attached to the yamen, the office where government business was conducted," he said.
The use of official residences is common practice overseas. In the United States, for example, accommodation is provided for incumbent senior officials, including the president, vice-president, state governors and vice-governors and the mayors of large cities.
In Germany, all senior officials, including the chancellor and government ministers, are provided with official residences, but only the chancellor is actually required to live in one. Ministers are free to choose where they live; in an official residence, in their own homes or in rented properties supported by a housing subsidy.
The common rule of thumb overseas is that official residences are owned and maintained by the state. Officials are only allowed to live in them during their period of office and are required to vacate if they resign, retire or are relocated.
The practice overseas
In foreign countries, the practice is based on transparency of information about the personal assets and salaries of senior officials. Moreover, a range of mechanisms - transparency of assets, judicial supervision and scrutiny by the public and media - provide a check on officials seeking private gain through power.
However, establishing an official residence scheme in China could prove difficult when the proposal becomes a reality. Many skeptics have claimed that it will be little more than a new way of providing perks and officials still won't be required to publicly disclose information about their personal wealth. "Who knows how many properties they already possess behind the scenes?" seems to be a common question posed on online forums.
"One prerequisite (of the proposed system) is that the property assets of officials should be made public when they are assigned a new official residence. Otherwise, the system cannot be justified to the public," said Wu from the Party School of the CPC Central Committee.
An official campaign, called "Clear House", has been implemented nationwide. A recent move came in Hubei province when 712 units of illegally occupied housing were taken back by the State, according to the provincial anti-graft authorities.
Pilot projects to promote the disclosure of officials' assets and promote clean governance have also been launched in a number of provinces,
leading a district government in Chongqing municipality to disclose information on the personal assets of 128 newly promoted officials.
"Although no timetable has been set for full disclosure, officials have already been required to provide detailed, all-encompassing information
about their personal assets to the Party, but not to the public", said Ma Qingyu, a professor at the Chinese Academy of Governance.
He said a highly anticipated "unified property registration system" will be launched by the middle of next year. It will allow information about officials' real estate interests to be shared via a nationwide network.
"Some officials are already ill at ease with the new leadership's strengthening of the anti-corruption campaign," he added.
In addition to the challenges regarding the disclosure of assets, the labyrinthine nature of the administration has caused many experts to doubt the feasibility of an official residence system.
"The biggest difficulty in implementing such a system lies in establishing boundaries between the different official levels and departments and deciding who is eligible for inclusion," said Ma.
Wang suggested that eligibility should be based on four criteria: Cases of national dignity; the nature of an official's work; the demands imposed by that work; and the individual's contribution to the fight against corruption.
Under these principles, Wang suggested that at the highest level, the system would cover the president, the premier, the chairman of the NPC Standing Committee, the chairman of the CPPCC National Committee, members of the Standing Committee of the Politburo, and the heads of the Supreme People's Court and Supreme People's Procuratorate. These positions reflect national dignity, he said.
As to the nature of the work, provincial governors and the heads of provincial high courts and procuratorates should be eligible, because the occupants of these posts are more likely to be tempted to wield their power for wealth.
Wang said the mayors of cities and counties, chiefs of the Party's organisation departments, heads of police and the secretaries of local discipline inspection commissions should also be included in the system.
Peking University's Yan said the proposed system would be incompatible with the current situation. "Who will live where and in which residence? How do the official residences vary depending on the seniority of officials?" he asked.
"China has a huge number of officials and many have no fixed terms of service. Most senior officials are either promoted by their superiors or continue in their current posts within the government until they retire," he added.
Ma was also troubled. "The situation is highly complex. Senior officials can be from different sections, such as the Party, the government, the National People's Congress, the Chinese People's Political Consultative Conference, not to mention army officers and the heads of courts and procuratorates," he said.
By the end of last year, there were around 7 million public servants in China, according to the State Administration of the Civil Service. There are no statistics about the number of officials at the very highest level, but Ma estimated that there are more than 2,000 at the provincial or ministerial level, and roughly 68 on the very top rung of the political ladder, such as State councillors, vice-presidents and members of the politburo.
"It would be better to severely limit the number of officials allowed to live in government residences," he said. "Those officials not included in the residence system could be provided with smaller, simpler government-sponsored housing.
"Only elected senior officials should be eligible for the housing system, rather than those appointed by their superiors, because elected officials have a fixed term of service so it's easier to ensure they move out when they leave office."
For Ma Baocheng, a research fellow at the Chinese Academy of Governance, the issue is not just a matter of accommodation, but also a demonstration of an individual's political power and their skill in handling the intricate relations between top leaders and their subordinates.
"A government residence compound is not just a place of accommodation - it's also a symbol of the execution and organisation of power," he said.
Lin Zhe, a law professor at the Party School of the CPC Central Committee, pointed to another problem the reformers may face: "An official residence system has to come up with follow-up reforms. It will go down the drain without effective inspection and supervision.
"The rules must clearly state the consequences if officials refuse to relinquish their State-owned homes, or turn them into private residences for sale or rent. There also needs to be an effective way of subjecting the use of official housing to public scrutiny.
"If you are not in a government position, you are simply a member of the general public or a Party member and there is no reason for you to continue enjoying the benefits attached to the position," she said.