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With a view to implementing the strategic planning set forth by the 16th CPC National Congress on establishing a sound socialist market economy and a more vigorous and open economic system, deepening the economic restructuring and promoting the overall economic and social development, the 3rd Plenary Session of the 16th CPC Central Committee has discussed some significant issues concerning the improvement of the socialist market economy and made the decision as follows: I. THE SITUATION AND TASKS OF CHINA'S ECONOMIC RESTRUCTURING 1. The significance and urgency of deepening the economic restructuring. Since the adoption of the reform and opening-up policies at the 3rd Plenary Session of the 11th CPC National Congress, the acknowledgment of the goals of restructuring the socialist market economy at the 14th CPC National Congress and the making of the relevant decision at the 3rd Plenary Session of the 14th CPC National Congress, China's economic restructuring has made significant breakthroughs in terms of both theories and practices. A socialist market economy has been established on a preliminary basis, the basic economic system with public ownership playing a dominant role and diverse forms of ownership developing side by side has been established, and the pattern of opening to the outside world in an all-round way, wide spheres and multiple layers has been basically formed. The deepening of the restructuring has not only greatly improved the social productivity, comprehensive national strength and people's living standards, but also helped China to endure such serious tests as the international economic and financial turbulences, grave natural disasters and disastrous epidemic situation. However, some problems still exist, such as the irrational economic structure, imbalanced distribution relations, sluggish growth of farmers' income, outstanding employment contradictions, intensified pressures on resources and environment and an economy being uncompetitive as a whole. The important reasons behind such problems are that China is still in the primary stage of socialism, that its economy has yet to be improved, and that the development of its productive forces is still facing many institutional obstacles. In order to adapt to the international environment of economic globalization and accelerated scientific and technologic progress and to meet the new situation of building a well-off society in an all-round way, we should speed up the restructuring, further release and develop productive forces and inject strong momentum into the economic development and overall social progress. 2. The goals and tasks of improving the socialist market economy. We should, in accordance with the requirements of coordinating the development of urban and rural areas, of different regions, of economic and social sectors and of man and nature, and of coordinating the national development and the opening-up to the outside world, give a fuller play to the basic role of market in the allocation of resources, enhance the vitality and competitiveness of enterprises, build a sound national macro-control system, improve the government functions of social administration and public services, and provide forceful institutional guarantee for the building of a well-off society in an all-round way. The main tasks are: to improve the basic economic system with public ownership playing a dominant role and diverse forms of ownership developing side by side; to establish a system conducive to phasing out the dual structure in urban and rural economies; to form a mechanism for promoting the coordinated development of regional economies; to build up a unified, open, competitive and orderly modern market system; to improve the macro-control, administration, and economic legal systems; to perfect the employment, income distribution and social security systems; and to build up a mechanism in promotion of sustainable economic and social development. 3. Guideline and principle of improving the economic restructuring. We should take the Deng Xiaoping Theory and the important thought of the "Three Represents" as the guideline, implement the basic line, program and experience, act on the spirit of the 16th CPC National Congress in an all-round way, emancipate our thoughts, seek truth from facts and keep pace with the times. We should follow the orientation of restructuring toward a socialist market economy and pay sufficient attention to institutional build-up and system innovations. We should respect the pioneering spirit of the people and bring into full play the initiative of both the Central Government and the local governments. We should correctly handle the relationship of reform, development and stability, and press ahead with the reform with priorities and in a step-by-step manner. We should make overall plans, take all factors into consideration and do a good job in coordinating various interests during the course of reform. We should uphold the principle of "man first" and form the concept of overall, coordinated and sustainable development so as to promote the overall economic, social and human development. II. FURTHER CONSOLIDATING AND DEVELOPING THE PUBLIC SECTOR OF THE ECONOMY AND ENCOURAGING, SUPPORTING AND GUIDING THE DEVELOPMENT OF THE NON-PUBLIC SECTORS OF THE ECONOMY 4. Applying multiple forms for effectively realizing public ownership. We should keep the public sector of the economy as the dominant player and bring into full play the defining role of the state-owned sector of the economy. We should vigorously promote multiple forms for effectively realizing public ownership and accelerate the adjustment of the layout and structure of the state-owned sector. We should adapt to the trend of marketization, further enhance the vitality of the public sector, vigorously develop a mix sector of the economy shared by state-owned capital, collective capital, non-public capital, etc., realize the diversification of investment sources and make the joint-stock system as the major form for realizing public ownership. For enterprises that need to be controlled by the state-owned capital, absolute or relative share holding shall be adopted under different circumstances. We should improve the mechanism for entry-withdrawal and rational movement of state-owned capital, encourage more state-owned capital to go to the important industries and key fields that have a bearing on national security and the lifeline of the national economy, and enhance the controlling power of the state-owned sector. The state-owned enterprises in other industries and fields should adopt assets reorganization and structural adjustment, and prosper or perish through fair market competition. We should create large internationally competitive companies and enterprise groups, give a freer rein to small and medium state-owned enterprises, deepen the reform of collective enterprises by focusing on clearly defined property rights, and develop various forms of the collective sector of the economy. 5. Developing and guiding the non-public sectors of the economy. Self-employed or private enterprises and other non-public sectors of the economy are important forces for promoting the development of social productive forces. We should remove or revise such laws, regulations and policies which are against developing the non-public sectors of the economy and eliminate the institutional obstacles thereto. The areas should be expanded for market access of non-public capital, which will be permitted to go to the infrastructures, public undertakings and other industries and fields where the inflow of such capital is not prohibited by the laws and regulations. Non-public enterprises should be treated equally with other enterprises in terms of investment, financing, taxes, land use, foreign trade, etc. We should support the development of small and medium-sized non-public enterprises and encourage the eligible enterprises to be stronger and larger. The small and medium-sized non-public enterprises shall conduct operations under the law, pay taxes in accordance with the regulations, and protect the lawful rights and interests of employees. Services for and regulation of non-public enterprises should be improved. 6. Establishing and improving the modern property rights system. Property rights, which include the rights over things, creditor's rights, stockholder's rights, intellectual property rights, etc., are the core and main content of ownership. A modern property rights system featuring clear-cut ascription, clearly defined rights and responsibilities, strict protection and smooth transfer should be established since it can: safeguard the public property rights and consolidate the role of the public sector of the economy as the main player; protect the private property rights and promote the development of the non-public sectors of the economy; facilitate the flow and reorganization of various capital and propel the development of the mixed sector of the economy; and enhance the business start-ups and innovations of both enterprises and people and form a sound credit foundation and market order. The establishment of the modern property rights system is not only the internal need for improving the basic economic system, but also the important basis for building a modern enterprise system. We should protect various kinds of property rights in accordance with the law, improving the trading rules and regulatory system of property rights, promote the orderly flow of property rights and safeguard the equal legal status and development rights of all market players. III. IMPROVING THE STATE-OWNED ASSETS ADMINISTRATION SYSTEM AND DEEPENING THE REFORM OF STATE-OWNED ENTERPRISES 7. Establishing and improving the state-owned assets administration and supervision system. The government shall separate its function of public administration with its role as state-owned assets investor. The state-owned assets administration organs shall, in accordance with the law, perform the investor's responsibilities for the state-owned assets under their supervision and administration, protect the rights and interests of the owners, safeguard various rights enjoyed by enterprises as market players, urge the enterprises to preserve and increase the value of state capital, and prevent the loss of state-owned assets. While establishing the state-owned assets budgetary institution and the enterprise operational achievement appraisal system, we should actively explore the effective means for supervision, administration and operation of state-owned assets and perfect the authorized operation system. The supervision and administration system should be established and improved for state-owned financial assets, non-profit assets, natural resources assets, etc. 8. Improving the corporate governance of companies. We should act on the requirement of the modern enterprise system to standardize the rights and responsibilities of the stockholders' meeting, board of directors, board of supervisors, corporate managers, and perfect the system for employment of corporate leaders. The shareholders' meeting decides on the members of the board of directors and the board of supervisors, the board of directors selects corporate managers, and corporate managers exercise the power of staffing. Such arrangement will form a check and balance mechanism among the power organ, decision-making organ, supervisory organ and corporate managers. Party organizations of enterprises should play their role as the political core, and by adapting to the requirement of corporate governance of companies, improve the way of role-playing, support the stockholders' meeting, board of directors, board of supervisors, and corporate managers in exercising power according to law, and participate in the decision-making on significant issues of enterprises. We should stick to the principle of the Party assuming the responsibility for cadres' affairs and combine it with the mechanism for employing corporate managers through market. The Central and local Party committees should strengthen and improve the administration of the team of leaders in backbone state-owned enterprises. By relying on the employees and masses wholeheartedly, we should explore the effective means of democratic management by employees under the modern enterprise system so as to protect the lawful rights and interests of employees. We should continue to propel the transformation of enterprises' operating mechanism, deepen the reform in the systems of labor, employment, personnel and income distribution, resettle redundant personnel, peel social management functions off enterprises and create a sound environment for the reform and development of enterprises. 9. Accelerating and improving the reform of monopoly industries. We should expand the areas for market access to monopoly industries and introduce competition mechanisms therein. Eligible enterprises should diversify the sources of investment. We should continue to propel and improve the restructuring of industries such as telecommunications, electric power, civil aviation, etc. The reform of railways, postal service, urban public undertakings, etc. should be accelerated by separating the functions of government from those of enterprises, assets and institutions. The natural monopoly businesses are subject to effective supervision and administration. IV. DEEPENING THE RURAL REFORM AND IMPROVING THE RURAL ECONOMY 10. Improving the rural land system. Household contract management of land is the core of the basic rural management system. We should keep stabilizing and improving the two-tier management system that integrates unified with separate management on the basis of household contract management, and safeguard various rights of farmers concerning contract management of land in accordance with the law. During the term of contract, farmer households may transfer the contractual right of land in accordance with the law and on a voluntary and compensatory basis. The methods of transfer should be improved so as to develop scale operation as appropriate in a step-by-step manner. We should practice the most stringent farmland protection system and secure the grain supply of the nation. We should reform the system and improve the procedures for land requisition in accordance with the principle of safeguarding the rights and interests of farmers and controlling the scale of land requisition. The use of land in construction for non-profit and business purposes should be defined strictly; land requisition shall conform to the overall planning and purpose control of land use, with fair compensation afforded to the farmers. 11. Perfecting the commercialized rural services, agricultural product market and rural support and protection systems. Rural collective economic organizations should promote institutional innovations and strengthen service functions. Farmers are supported to develop diverse forms of rural professional cooperative organizations on a voluntary and democratic basis. Industrial and commercial enterprises are encouraged to invest in and develop the processing and marketing of agricultural products. We should vigorously promote the industrialized operation of agriculture and form the industrial chain featuring the integration of scientific research, manufacturing, processing and sales. The reform of agricultural science and technology and supply-and-marketing cooperatives should be deepened so as to form a commercialized service system of agriculture with broad participation of social forces. We should improve the market system for agricultural products, open the grain purchase market, and change indirect subsidy through the distribution link into direct subsidy to farmers, in an effort to protect the interests of grain farmers. The state should give more support and protection and increase the input of treasuries at all levels to agriculture and rural areas. The mechanism for poverty-relief development should be improved. The state will direct the new increase of expenses on public undertakings such as education, health, culture, etc. mainly towards rural areas, and explore the establishment of a policy-oriented agricultural insurance system. 12. Deepening the rural tax and fee reform. The rural tax and fee reform is a significant step in easing the farmers' burden and deepening the rural reform. We should improve various policies on the experiment of rural tax and fee reform, cancel the agricultural specialty tax, and accelerate comprehensive and complementary reforms in government departments at county and township levels, rural compulsory education system, etc. Based on the completion of the experiment, we will cut the agricultural tax rate step by step so as to ease the farmers' burden. 13. Improving the environment for transfer employment of rural surplus laborers. The bi-directional movement and employment of rural surplus laborers between urban and rural areas is an important channel for increasing the farmers' income and propelling urbanization. We should establish and improve the training mechanism for rural laborers, propel the reform and adjustment of township enterprises, boost the county economy, expand the space for rural employment, eliminate the restrictive provisions on the movement of farmers to cities for employment, and create more job opportunities for farmers. We should unify the urban and rural labor markets step by step, strengthen guidance and administration in this regard and form a system for equal employment of urban and rural laborers. We should deepen the residence registration system, improve the administration of floating population and guide the smooth and orderly transfer of rural surplus laborers. The urbanization process should be accelerated; rural folk who have stable occupation and residence in the city may go through residence registration at the place of his employment or residence under the local provisions, and enjoy the due rights and bear the due responsibilities as local residents in accordance with the law. V. IMPROVING THE MARKET SYSTEM AND REGULATING THE MARKET ORDER 14. Accelerating the building of a unified national market. Enhancing the unity of market is a significant task in building a modern market system. We should boost the opening up of market both internally and externally, accelerate the market-oriented reform of factors' prices, develop such modern circulation forms as e-commerce, chain operations, efficient flow and distribution of materials, etc. and promote free movement and full competition nationwide of goods and factors of various kinds. Any provisions carving up the market by obstructing fair competition, installing administrative barriers or excluding the products or services of other places shall be repealed, and trade monopolies and regional blockades shall be smashed. We should vigorously develop professional market intermediary organizations featuring independence, impartiality and standardized operation, and regulate and develop all kinds of self-disciplined organizations such as trade associations, chambers of commerce, etc. in the principle of market orientation. We should improve the market regulation system featuring the integration of administrative law enforcement, trade self-discipline, public opinions supervision and mass participation, perfect the product quality supervision and administration mechanism, harshly crack down on such illegal acts as manufacturing and sales of fakes, business fraud, etc., and maintain and improve the market order. 15. Boosting the capital market and the markets of other factors. We should propel the reform, opening-up and stable development of the capital market, and expand direct financing. We should establish the multi-layer capital market system, improve the structure of the capital market and develop diverse forms of products therein. We should regulate and develop the main-board market, and propel the construction of the venture capital and growth enterprise market. We should develop the bond market, improve and regulate the bond issuing procedures and expand the scale of corporate bond issuing. We should develop institutional investors and expand the channels for qualified capital to go to the stock market. We should establish a unified securities market with mutual accessibility and improve the system of trading, registration and settlement. The development of markets for factors such as land, technologies, labor, etc. should pick up speed. The development of property rights trading should be regulated. While boosting the market for property and person insurances as well as reinsurance, we should keep the futures market at steady growth. 16. Establishing and improving the social credit system. The formation of a social credit system with morality as its support, property rights as its foundation and law as its guarantee is a necessary condition for building a modern market system as well as a permanent solution for rectifying the market economic order. The credit awareness of the whole society should be enhanced; the government, enterprises, non-profit institutions, and individuals should take honesty and good faith as their basic norm of behaviors. We should follow the orientation of legal perfection, franchised dealing, business operation and professional services, and accelerate the building of enterprise and individual credit service systems. The systems for credit supervision and punishment against breach of faith should be established. The credit services market will be opened up step by step. VI. CONTINUING TO IMPROVE MACRO-CONTROL AND ACCELERATE CHANGE IN GOVERNMENT FUNCTIONS 17. Improving the national macro-control system. We should further improve the macro-control system featuring the coordination of state planning and fiscal and monetary policies. The macro-control targets and overall requirements set forth in the state planning are the major basis for formulating fiscal and monetary policies. Fiscal policies play an important role in promoting economic growth, optimizing the economic structure and adjusting incomes; the ways for effectively implementing fiscal policies should be improved. Monetary policies play an important role in maintaining the stability of currency value and the aggregate balance of money supply; the conduction mechanism of monetary policies should be improved. We should pay attention to the effect of such factors as aging of population on social demand and supplies. We should improve the statistics system, perfect the monitoring system for economic functioning, strengthen the coordination of functions and sharing of information among various economic macro-control departments, and raise the macro-control level. 18. Changing the economic administration functions of the government. We should deepen the reform of the administrative approval system and redefine the economic administration functions of the government as serving market players and creating a sound environment for their development. We should enhance research on and formulation of the medium and long-term planning for national economic and social development, put forward significant strategies, basic tasks and industrial policies on development, promote the overall national economic and social development, and coordinate economic growth with population, resources and environment. We should strengthen the coordination and guidance of regional development, propel the development of the country's western regions, effectively exert the advantages of the central regions, support the central and western regions in accelerating reform and development, revitalize old industrial bases such as the northeast regions, and encourage qualified places of the eastern regions to take the lead in accomplishing modernization by and large. We should improve the government decision-making procedures for significant economic and social issues on a scientific, democratic and standardized basis, fully utilize the social intellectual resources and modern information technology, and enhance the degree of transparency and mass participation. 19. Deepening the reform of the investment system. We should further consolidate the status of enterprises as investors and adopt a system under which investors have the right of decision-making, reap the returns and bear the risks. Only the significant projects that have a bearing on economic security, environment, resources and overall economic layout, government-invested projects and restrictive projects are subject to the approval of the state. Other projects are subject to the record-keeping system instead of the approval system: the investors will make decisions on their own and go through the procedures for land use, resources, environmental protection, safety, etc. in accordance with the law. For projects subject to approval, we should divide power rationally between the Central Government and the l governments, expand the right of large enterprise groups in investment decision-making, perfect the consultancy and verification system, reduce links and improve the efficiency. The government decision-making and project legal person regulating mechanisms should be improved. The state will, mainly through planning and policy guidance, information release and market access regulation, guide the investment directions of social forces, and restrain disorderly competition and blind and redundant construction. VII. IMPROVING THE FISCAL AND TAXATION SYSTEMS AND DEEPENING THE FINANCIAL REFORM 20. Implementing the reform of the taxation system. The state will steadily push forward the taxation reform in accordance with the principle of a more simplified taxation system, broader tax collection basis, lower tax rates and stricter tax collection. The system of drawback will be reformed. Taxation on various kinds of enterprises will be unified. The Value-added taxes will become consumption-oriented instead of production-oriented, and equipment investment will be brought into the range of VAT deduction. The consumption taxes will be improved with broader tax collection basis. The collection of personal income taxes will also be improved with a system featuring the combination of comprehensive and classified personal income taxes being adopted. The reform of urban construction taxes and fees will be implemented; when conditions are in place, the unified and standardized property tax will be collected on real estate while the relevant fee-charging items will be cancelled. Appropriate tax administration power will be granted to local governments on the basis of a unified system for tax administration. Conditions should be created to gradually introduce a unified taxation system in both urban and rural areas. 21. Propelling the reform of the fiscal administration system. The state will perfect the public finance system and define the responsibilities of governments at all levels on fiscal expenditure. The transfer payment system will be further improved to increase fiscal support to the central and western regions and the areas inhabited by ethnic minorities. The reform in departmental budget, centralized collection and payment by state treasury, and bilinear administration of government procurement and collection-payment will be deepened. The administrative fee-charging items should be straightened out and regulated; any item that can be incorporated into the budget is subject to budgetary administration. We should reform the system of budget making, perfect the check and balance mechanism for budget making and implementation, and strengthen the audit supervision. The budgetary performance appraisal system will be established. The full-caliber budgetary administration and the effective monitoring of contingent liability will be adopted. A people's congress at any level should strengthen examination and supervision of the budget of the same-level government. 22. Deepening the reform of financial enterprises. All commercial banks and securities, insurance and trust investment companies should become modern financial enterprises with ample capital, tight internal management, safe operation, excellent services and good economic returns. We shall promote the shareholding reforms in some qualified state-owned commercial banks, which shall step up efforts in handling bad assets and increasing capital funds to create conditions for being listed on the stock market. The reform of policy-oriented banks will be deepened. The operating mechanism of financial assets management companies will be improved. Social funds should be encouraged to participate in the restructuring of small and medium-sized financial institutions. Financial enterprises of different ownerships should be steadily developed under the precondition of tightened supervision and secured capital funds. The rural financial services system should be improved with appropriate support afforded by the state. Experience should be obtained through experiment so as to gradually turn rural credit cooperatives into local financial enterprises providing services to rural communities. 23. Perfecting the financial control mechanism. We should steadily deregulate interest rates to leave them to market forces and establish and improve the system under which interest rates are decided according to the market supply and demand and the central bank only influences the rate changes through its monetary policies. We shall perfect the mechanism for forming the exchange rate of RMB and maintain a general stability of RMB at a reasonable and balanced level. Under the precondition of effective prevention of risks, the state will ease the restriction on cross-border capital transactions in a selective and step-by-step manner, and gradually realize the convertibility of capital accounts. A unified, efficient and safe payment settlement system will be established and improved. The Central Bank should improve its financial control; a mechanism featuring the integration and coordination of the currency, capital and insurance markets should be established and improved so as to maintain overall stability of financial operations and financial market and to prevent systematic risks. 24. Perfecting the financial supervision system. We should ensure open, fair and orderly market competition in the financial market so as to effectively prevent and dissolve financial risks and protect the lawful rights and interests of money depositors, investors and the insured. We should perfect the mechanism for the monitoring, alerting and handling of financial risks and apply the market disqualification system in strict compliance with the law. We must tighten up financial supervision, prevent and crack down on financial crimes. We must enhance the transparency of supervisory information and subject financial operations to social supervision. We should handle well the relationship between supervision of financial operations and support for financial innovations, and encourage financial enterprises to explore effective ways of financial operations. The coordination mechanisms among banking, securities and insurance regulatory institutions and among such institutions, the Central Bank and finance departments should be established and improved so as to raise the level of financial supervision. VIII. DEEPENING THE REFORM OF THE ECONOMY INVOLVING FOREIGN ELEMENTS AND OPENING WIDER TO THE OUTSIDE WORLD 25. Improving the institutional guarantee of opening to the outside world. We should act on the requirements of the market economy and the WTO rules to speed up the integration of domestic and foreign trade. We should form a stable and transparent system for administering the economy with foreign elements and create a fair and predictable legal environment so as to ensure the autonomy and equality of enterprises of various kinds in foreign economic and trade activities. We should administer foreign economic activities in accordance with the law, strengthen services and supervision and further improve the freedom and convenience of trade and investment. The monitoring system for foreign trade operations and the alarm mechanism for international balance of payments should be established and improved to safeguard the national economic security. 26. Making better use of foreign investment. We should seize the great opportunity in a new round of global optimization and restructuring of production factors and transfer of industries to expand the scale and use of foreign investment. We should introduce more foreign advanced technologies, management experience and high-quality talents by catering to the readjustment and upgrading of domestic industrial structure, and give emphasis to the assimilation, innovation and improvement of technologies introduced. We should continue to develop processing trade, attract multinational corporations to transfer their processing and manufacturing factories and R&D institutions of higher technology to China, and guide the transformation and upgrading of processing trade. We should further improve the investment environment, expand the investment scope, attract foreign investment to go to the areas with necessary conditions and the fields conforming to the national industrial policies in a faster pace, and strive to form some more economic growth belts with intensive foreign investment, domestic and international integration and strong leading effect. 27. Enhancing the capability to join international cooperation and competition. Domestic enterprises will be encouraged to make full use of the favorable situation of opening wider to the outside world to enhance the capability of market exploration, technological innovation, and brand cultivation on their own. Enterprises should improve the quality, grade and added value of the exported goods, expand the export of high and new-tech products, develop the trade in services and enhance the overall competitiveness in export. We should continue to implement the "Going-out" Strategy, perfect the services system for foreign investment, give enterprises more autonomy in oversea operations, improve the regulatory mechanism for overseas investment enterprises and promote the development of Chinese multi-national corporations. We should vigorously join and promote regional economic cooperation. IX. ADVANCING THE REFORM OF THE EMPLOYMENT AND DISTRIBUTION SYSTEMS AND IMPROVING THE SOCIAL SECURITY SYSTEM 28. Deepening the reform of the system of labor and employment. We should pay more attention to employment expansion, adopt pro-active employment policies, and strive to better the business start-up and employment environment. Laborers will be encouraged to choose jobs on their own, with employment being regulated through the market mechanism and promoted by the government. Enterprises will be encouraged to create more jobs. The reform, development and structural adjustment should be closely connected with employment expansion. We should act on the requirements of expanding employment and reemployment, pay sufficient attention to the development of labor-intensive industries, support small and medium-sized enterprises, further the non-public sectors of the economy and adopt flexible forms of employment. We should improve the employment services system, strengthen vocational education and skill trainings and help special needy groups to get jobs. The employment behaviors of enterprises should be regulated in an effort to safeguard the lawful rights and interests of laborers. 29. Advancing the reform of the system of income distribution. We should improve the system under which distribution according to work is dominant and a variety of modes of distribution coexist, and give priority to efficiency with due consideration to fairness. Various production factors may participate in the distribution of income according to their respective contributions. We should rectify and regulate the order of income distribution and intensify the efforts in adjusting such distribution. Sufficient attention should be paid to narrowing the overly wide gap of income between some social members. Bearing in mind the objective of common prosperity, we should raise the proportion of the middle-income group, increase the income of the low-income group, regulate excessively high income and outlaw illegal gains. The supervision and administration of income distribution in monopoly industries should be strengthened. We should improve the personal income monitoring measures and strengthen collection and administration of personal income tax. We should improve and regulate the wage system for state civil servants, and propel the reform of the distribution system in public institutions. We should regulate the consumption attached to a post and accelerate the fixing of fringe benefits in money. 30. Accelerating the building of a social security system compatible with the level of economic development. We should improve the basic pension insurance system for employees of enterprises, combine socially pooled funds with personal contributions, and gradually secure personal contributions. Urban workers will be covered by basis pension insurance. The provincial pension insurance balance funds will be established and amplified; pension insurance funds will be raised within provincial domains on the basis of the perfection of fund-raising at the city level. When conditions are in place, the basic part of pension insurance funds will be raised nationwide. The unemployment insurance system should be improved so as to bring the guarantee of subsistence allowances for laid-off workers of state-owned enterprises to the track of unemployment insurance. We should continue to improve the synchronous reform of the basic medical insurance system for urban residents, the medical and health system and the medicine production and distribution system, expand the coverage of basic medical insurance and perfect the social medical assistance and multi-layer medicare systems. The injury and childbearing insurances for employees should continue to be promoted. Exploration should be made to reform the social security system for government organs and public institutions. We should improve the system of subsistence allowances for urban residents and rationally determine the criterion and forms thereof. Diverse forms may be adopted such as transferring some state-owned assets to replenish social security funds. We should strengthen the collection of social security funds, broaden the collection basis, regulate the supervision and ensure the safety, of such funds. While encouraging qualified enterprises to establish supplementary insurances, we should vigorously develop commercial pension and medical insurances. Rural old-age guarantee, with the main responsibility thereon being borne by households, will be combined with community safeguard and state assistance. Places where conditions permit may explore the establishment of a rural subsistence allowances guarantee system. X. DEEPENING THE REFORM IN SYSTEMS OF SCIENCE AND TECHNOLOGY, EDUCATION, CULTURE AND HEALTH AND IMPROVING THE NATIONAL INNOVATION CAPABILITY AND OVERALL QUALITY OF CHINESE CITIZENS 31. Creating an institutional environment for implementing the strategy of powering the country with talents. Innovations should be made on the working mechanism of talents so as to cultivate, attract and make good use of talents of all kinds. We should build a large-scale, well-structured and high-quality contingent of talents who are mainly composed of Party and government officials, corporate leaders and professional technicians. We should conduct multi-level trainings for talents through diverse channels and at a large scale, and give priority to cultivating a batch of high-level and skillful talents. The tapping of talents will be enhanced in the western regions and the areas inhabited by ethnic minorities, and a mechanism will be established for outstanding talents to go to work in the western regions, grassroots units, and places with harsh conditions. We must respect knowledge, encourage creation, practice fair competition, improve the mechanism of incentives, and form a good environment which makes it possible for outstanding people to come to the fore in all fields and to bring their potential into full play. We should establish and improve the talent market system, further promote the flow of talents, and introduce various kinds of talents urgently needed in the country's modernization. 32. Deepening the reform of the administration system of science and technology. We should reform the administration system of science and technology, accelerate the building of a national innovation system, promote the optimal allocation and comprehensive use of scientific and technologic resources in the whole society, and integrate science and technology into economic and social development. The dominant role of enterprises in technologic innovations and in making investment in science and technology should be affirmed so as to provide equal conditions for the competition of all enterprises in innovations. For research institutions that must be supported by the state in conducting innovations in basic research, high technology of strategic importance and important research fields with a nature of public welfare, a modern research institution system featuring clearly defined responsibilities, scientific appraisal, openness, order and standardized administration should be established. Market-oriented institutions engaging in R & D of applicable technology should adopt the transformation toward enterprises and build the modern enterprise system in a faster pace. The marriage of higher education and scientific and technologic innovation will be promoted. The innovation system for combining military efforts with civilian support will be established so as to achieve the coordinated promotion and development of national defense technology and civilian technology. We should establish the innovation system for theories of philosophy and social sciences and promote the coordinated development of social and natural sciences. 33. Deepening the reform of the system of education. We should introduce a modern system of national education and a lifelong learning system, build a society that keeps learning, push forward quality education in an all-round way, enhance citizens' capability in seeking employment, carrying out innovation and starting enterprises, and strive to turn the country's huge population into an advantageous ample supply of human resources. We should propel educational innovations, optimize the structure of education, reform the modes of cultivating students, improve educational quality and create an educational system compatible with the requirements of economic and social development. The administration system for rural compulsory education with the main responsibility on county-level governments should be established and improved. The system under which all staff members in schools are employed on a contractual basis and the qualification system for teachers will be implemented. The education investment system featuring the dominant role of government funding and the raising of funds through multiple channels should be established and improved, and a situation for common development of public-funded and private schools should be created. The system for funding students from poor families by the state and the society should be improved. 34. Deepening the reform of the system of culture. We should, according to the characteristics and law of constructing socialist spiritual civilization and by adapting to the requirement of developing a socialist market economy, gradually establish a cultural administration system featuring the leadership of Party committees, government administration, self-regulation of trades, and lawful operation of enterprises and non-profit institutions. We should change the functions of the administrative departments in charge of culture and promote the coordinated development of culture as non-profit undertakings and industries. During the development of culture, we should put social effects at the first place and strive to integrate social with economic effects. While deepening the reform of the systems of labor, personnel, income distribution and social security, organizations engaging in cultural undertakings of a non-profit nature will receive more funding from the state so as to increase their vitality and improve their services. Organizations engaging in cultural industries of a business nature should seek institutional innovations and transformation and get stronger through market competition. It is imperative to improve the cultural market system and establish a dynamic manufacturing and management system for cultural products. We should improve policies for cultural industries, encourage fund-raising through multiple channels, promote common development of various cultural industries and create a number of large cultural enterprise groups, so as to enhance the overall strength and international competitiveness of cultural industries. The order of the cultural market will be regulated in accordance with the law. We should deepen the reform of sports, build a services system for popular sports, perfect the system of competitive sports, promote the healthy development of sports industries, and improve the physique of the entire people. 35. Deepening the reform of the system of public health. We should beef up the government's role in public health administration and build a health and medical system in conformity with the socialist market economy. We should step up the construction of public health facilities, make full use of and integrate existing resources, set up and improve a disease information network system, disease prevention and control system and medical treatment system to better the state's capability in offering public health services and in responding to possible public health emergencies. While accelerating the reform of the medical and health system in urban areas, we should improve health and medical facilities in the countryside, establish a new rural cooperative medical system, and provide medical aid to needy farmers. The advantages of integrating the traditional Chinese medicine with western medicine in medical treatment should be tapped. We should do a good job in environmental health and foster the awareness of health in the entire population. We should improve the hygienic monitoring system and ensure the safety of food, medicine and medical treatment. XI. DEEPENING THE REFORM OF THE ADMINISTRATIVE SYSTEM AND IMPROVING THE ECONOMIC LEGAL SYSTEM 36. Continuing the reform of the administrative system. The creation of an administrative system featuring standardized behaviors, coordinated operation, fairness and transparency, honesty and high efficiency should be accelerated. We should further adjust the establishment of government organs of various levels and straighten out functions of different government organs so as to legalize the functions and responsibilities of government, the establishment of government organs and the size thereof. The system of state civil servants will be improved. The government should uphold the rule of law in its administrative activities, exercise power and perform functions in strict compliance with the statutory jurisdiction and procedures. E-government should be developed to improve services and administrative levels. The early-warning and emergency response mechanism should be established and improved so as to improve the government¡¯s capabilities to meet challenges brought about by sudden incidents and risks. The system of work safety supervision and administration should be improved. Efforts should be made to deepen the reform of local administrative systems and to cut the size and reduce the staff of local governments. The reform of public institutions will go forward. We should improve grassroots self-governing organizations and bring into full play the role of urban and rural communities in self-administration and self-services. 37. Rationally distributing the responsibilities and powers of the Central Government and local governments in administering economic and social affairs. The administrative responsibilities and powers of the Central Government and local governments in conducting economic regulation, market supervision, social administration and public services should be clearly defined in accordance with the principle of upholding the unified leadership of the Central government and bringing into full play the initiatives of local governments. Affairs that have a nationwide impact or go beyond the border of a province (autonomous region, municipality directly under the Central Government) should be administered by the Central Government so as to ensure the unity of the state legal system, of policies and orders, and of the market. Local affairs within an administrative area should be administered by the local government so as to improve work efficiency, reduce administrative costs and enhance administrative vitality. For affairs jointly administered by the Central Government and local governments, it is imperative to define the administrative scope and identify the primary and secondary responsibilities, of the Central Government and local governments, under different circumstances. The division of functions and responsibilities between the Central Government and local governments in fields such as finance, taxation, banking, investment and social security should be gradually straightened out according to the distribution of responsibilities and powers in administering economic and social affairs. 38. Propelling the building of an economic legal system in an all-round way. We should strengthen the economic legislation in accordance with the basic principle of running the country by law and with a view to establishing rules, regulating rights and responsibilities and safeguarding rights and interests. We should improve the legal system regarding market players and intermediary organizations so that market players of various kinds can truly have the full capacity for action and responsibility. The legal system of property rights will be improved for the purpose of standardizing and straightening out property rights relations and protecting the rights and interests of various property rights. Efforts should be made to improve the legal system regarding market dealings, to guarantee free contracts and safety of dealings and to safeguard fair competition on the market. We should improve the laws and regulations on budget, taxation, finance and investment so as to regulate economic control and market supervision. We should improve the laws and regulations on labor, employment and social security so as to protect the lawful rights and responsibilities of laborers and citizens. We should also improve the laws and regulations in the social sector and on sustainable development so as to promote economic development and social progress in an all-around way. 39. Strengthening law enforcement and supervision. Efforts should be intensified to enhance the explanation of laws and regulations and law enforcement, and to improve the capabilities and levels of administrative law enforcement, judicial adjudgement and procuratorial work, so as to guarantee the effective implementation of laws and regulations and to safeguard the unity and dignity of the legal system. A law-enforcement system featuring clearly defined powers and responsibilities, regulated behaviors, effective supervision and forceful safeguard will be established according to the requirements of connecting responsibilities with power and disconnecting interests from power, in an effort to prevent and correct local protectionism and selfish departmentalism. We should reform the system of administrative law-enforcement, concentrate the power of administrative punishment to a degree as appropriate, and push forward the experiment of comprehensive law-enforcement. We should propel the reform of the judicial system to safeguard judicial justice. We should adopt the accountability system for law enforcement and the system of investigation and punishment against improper acts of law enforcement so as to enforce the law as it is written, with impartiality and civility. XII. STRENGTHENING AND IMPROVING THE LEADERSHIP OF THE PARTY AND WORKING HARD TO IMPROVE THE SOCIALIST MARKET ECONOMY 40. The leadership of the Party is the basic guarantee for smoothly pushing forward the reform. The building of a perfect socialist market economy is a decision of great importance for the present situation and of far-reaching historical significance made by the Party for the new period in the new century and will be a new major challenge for the whole Party. All Party members should fully understand the historical responsibility bestowed on them, keep learning new knowledge, studying new situations and solving new problems, and continue to explore ways that efficiently accommodate socialism and the market economy. The Party should reform and improve the means of leadership and ways of ruling in accordance with new situation arising in the socialist market economic development, make the overall planning, control the direction of development, manage important affairs, and further enhance the capabilities of sizing up the situation in a scientific way, of keeping the market economy well in hand, of coping with complicated situations, of exercising state power in accordance with the law, and of commanding the whole situation. We should adhere to the principle of the Party assuming the responsibility for talents¡¯ affairs, train and prepare a large number of talents of various kinds suitable for needs of modernization, and strengthen the building of team of leaders at all levels and of grassroots Party organizations, so as to provide forceful organizational guarantee for reform and development. We should have in mind the general situation of China, make decisions and doing things in a down-to-earth manner, suit measures to local conditions, unify the intensity of reform, the speed of development and the society's endurable capability and solve various contradictions to ensure social stability and an orderly work. Various reforms should be pushed forward in a unified way and efforts should be made to bring a harmony between macro and micro economic reforms, between reforms in economic sectors and in social life, between urban and rural reforms, and between economic and political restructuring. 41. Improving the work style of the Party and building a clean and honest government. Improved construction of the Party¡¯s work style and a clean and honest government combating and preventing corruption is an important guarantee for the establishment and improvement of the socialist market economy; thus it should be carried on through the entire process of reform, opening-up and modernization. We should do a good job in educating officials, especially leading officials, of Party and government departments, to be clean, honest and self-restrained, stand firm in dealing with different kinds of rule-breaking or law-violating cases, and rectify in a down-to-earth manner practices against the interests of the masses. We should persist in tackling both the roots and symptoms of problems, deal with problems in comprehensive ways, pay sufficient attention to ideological and ethical education, step up the legal construction in ensuring a clean and honest government, improve the supervision and regulation mechanism, and establish and improve a punitive and corruption-alert system that attaches equal importance to education, system and supervision, commensurate with the socialist market economy. We should uphold the principle that the Party is built for the public and that it exercises state power for the people, keep the work style of being modest and prudent, of guarding against arrogance and rashness, and of hard struggle, and be firm against erosion of various unhealthy practices, so as to create a fine social environment for the improvement of the socialist market economy. 42. Upholding the coordinated development of socialist material, political and spiritual civilizations. Socialism with Chinese characteristics is a great cause that features a coordinated development of socialist market economy, democratic politics and advanced culture. We should push forward the reform of the political system in a safe way, expand socialist democracy, improve the socialist legal system, solidify and enlarge the united patriotic front, and enhance ideological and political work, to offer a strong political guarantee for developing the socialist market economy. Great efforts should be made to step up socialist cultural construction, with emphasis placed on the establishment of a socialist ideological and ethical system commensurate with the socialist market economy, socialist laws and fine traditions of the Chinese nation, and to carry forward and cultivate the national spirit and keep improving the ideological and ethical quality, scientific and cultural quality of the whole nation, in a bid to provide reform and development with a strong spiritual impetus and intellectual support. All Party comrades and the people of all ethnic groups of the country, let us be guided by Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory and the important thought of the "Three Represents", fully act on the spirit of the 16th CPC National Congress, rally closely around the CPC Central Committee with Comrade Hu Jintao as its Secretary-General, make pioneering efforts, do a solid job and work hard to realize the great goals of establishing a perfect socialist market economy and building a well-off society in an all-round way! |
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