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TABLE OF CONTENTS CHAPTER I GENERAL PROVISIONS CHAPTER II FORMS OF THE RESPONSIBILITY SYSTEM CHAPTER III BASIS FOR CONTRACT PROJECTS CHAPTER IV CONTENT OF CONTRACT PROJECTS CHAPTER V RIGHTS, INTERESTS, REWARDS AND PENALTIES CHAPTER VI CHECK UP OF PROVISIONS OF CONTRACTS CHAPTER VII SUPPLEMENTARY ARTICLES CHAPTER I GENERAL PROVISIONS Article 1. The Rules hereunder are formulated with a view to improving the management of capital construction, remedying abuses of extravagant spending and "everybody eating from the same big pot", stimulating the enthusiasm of all participants, shortening the building time, ensuring the quality of projects, reducing construction costs and achieving better economic results. Article 2. The economic responsibility system in undertaking construction projects under contract is a management system with a combination of responsibility, rights and benefits for the units concerned, which assume full responsibility for construction scale, total investments, building time, quality and consumption of materials of construction projects determined by the state plan. It is an important reform in the management of capital construction. Article 3. Vigorous measures shall be adopted to create condition for the gradual implementation of the economic responsibility system in the undertaking of all the projects listed in the state plan. The economic responsibility system shall be carried out as soon as possible in projects already set for construction, the reasonable building time limit of which has been defined. Article 4. In the implementation of the economic responsibility system in undertaking construction projects under contract, state laws shall be abided by, state plans, guidelines and policies carried out, relations between partial and overall interests and those between the state, the collective and individual interests correctly handled, and the principle of "distribution according to work" followed in earnest. Management shall be improved and labor efficiency raised so as to economize on investment and shorten the building time. Deliberate assessment of high costs, charging of high prices and lowering of quality are not allowed. Article 5. The departments at various levels in charge of the work shall strengthen their leadership over the execution of the responsibility system. In accordance with the aim of selecting more revolutionary, younger, better educated and more professionally competent cadres, those with greater expertise in management shall be chosen to form the leading bodies of the unit undertaking a project. The leading bodies shall remain stable so as to be held responsible for the construction project through to the end. Article 6. The parties involved in the undertaking of a contract project under the economic responsibility system shall define the content, conditions, responsibilities, economic rights and interests in the undertaking through consultation, contracts or other legal procedures. They shall co-ordinate closely to ensure the fulfilment of the contract tasks. CHAPTER II FORMS OF THE RESPONSIBILITY SYSTEM Article 7. In accordance with the characteristics and concrete conditions of construction projects, various forms of the responsibility system may be adopted, in which, for example: (1) The building unit must fulfill its contract with the higher-level department in charge of a project; (2) The unit in charge of construction must fulfill its contract with the superior department in charge of a project or the building unit; (3) The department at a lower level in charge of a project must fulfill its contract with the superior department in charge; (4) Construction projects which require comparatively simple building techniques and a comparatively greater labor force, such as railway roadbeds, highways, water conservation projects and buildings for civil use, may be undertaken by units organized in a unified way by localities taking full responsibility; (5) A comprehensive development unit or a designing unit must fulfill its contract with the department in charge; (6) If the necessary conditions exist, a building unit may assume full responsibility to a region or a department for the fulfillment of building tasks, not referring to specific projects. Article 8. In implementing the economic responsibility system for the undertaking of a construction project by a unit, no matter what form of responsibility system may be adopted, tasks shall be made concrete for people at each level in the unit. If a department, a bureau or a building unit undertakes a project, it shall conclude a contract with a construction unit in accordance with the requirements for the undertaking of the project. The economic responsibility system shall be instituted at every level within a construction unit. In accordance with the requirements set for the undertaking of a contract project, the unit responsible for it shall sign agreements or contracts with the units concerned, such as the surveying and designing institutes, material and equipment supply units, so as to ensure the fulfilment of the tasks undertaken. Article 9. In a region or a department where necessary conditions exist, a construction project may be undertaken by way of issuing calls for tenders on a trial basis. Concrete rules for implementation shall be worked out by the relevant departments and regions, but shall be reported to the State Planning Commission for the record. CHAPTER III BASIS FOR CONTRACT PROJECTS Article 10. In undertaking construction projects under contract, the procedures for capital construction shall be followed, preconditions for construction shall be fulfilled, and approval of documents describing design tasks, initial design and general budgetary estimate shall be obtained. These projects shall be included in the investment plans for fixed assets under the administration of relevant departments at various levels. For those projects involving "five fixed items", that is, where the construction scale, the total investments, building time limit, economic results and the main conditions for co-ordination are all fixed, the items serving as the basis for undertaking the contract projects shall be re-examined and approved. Article 11. Norms for undertaking contract projects shall be calculated and determined in accordance with the existing quotas and standards approved by the state or a department, a province, a municipality or an autonomous region. In the absence of unified quotas and standards, norms shall be worked out jointly by the designing and construction units and the Reconstruction Bank in accordance with the principle of average advanced level, and reported to the department in charge for approval. CHAPTER IV CONTENT OF CONTRACT PROJECTS Article 12. Any unit undertaking construction projects shall be responsible for the following main items: (1) It is responsible for investment. The amount of investment shall be determined by the approved designing budgetary estimate or the approved budget of the construction blueprint. According to concrete conditions, contracts for investment may be based on either the designing budgetary estimate, the budget of construction blueprint, including the safety factor, or the cost of building per square meter of a project; (2) It is responsible for building time. Building time shall be determined according to the reasonable time limit set by the state plan or by the superior department in charge; (3) It is responsible for quality. The relevant technical standards, norms and the quality required by the design of the project shall be taken as the standard for checking the quality of the project; (4) It is responsible for the amount of important materials used. The amount of principal materials set in the list provided by the designing papers or the list of principal materials agreed upon by the contracting parties; (5) It is responsible for the formation of comprehensive productive capacity. In building an industrial project, the principal and subsidiary parts, and the part for handling the "three wastes" shall be constructed at the same time in compliance with the designing stipulations and turned into comprehensive productive capacity to suit the designed scope of construction. For projects of some industrial branches, the units undertaking them are responsible for the duration of time within which the designing productive capacity shall be reached. For non-industrial projects, the units undertaking them are responsible for the quality of projects being up to standard when they are put to use. Article 13. If a department in charge entrusts a building unit with the construction of a project or a building unit entrusts a construction unit with the task, the following building conditions shall be ensured: (1) Ensuring building investment. An annual plan for investment shall be worked out in accordance with the defined general rate of construction progress and the total amount of investment so that investment for continuous construction shall be ensured; (2) Ensuring equipment and materials. Supply of equipment and materials shall be organized within the limit of norms defined by the relevant contracts, in accordance with the list of amount of equipment and materials needed and the rate of construction progress. If the necessary conditions exist, the allocation quota for materials may be given to a construction unit which shall organize its stock or a material-supply unit may deliver materials directly to the construction site; (3) Ensuring outside subsidiary conditions. Outside building conditions such as supply of electricity, water, communication and transport shall be arranged appropriately; (4) Ensuring production personnel. The number of production personnel shall be applied for and promptly approved in accordance with the number of personnel defined in the designing of the project and the progress of preparation for production; and (5) Industrial projects ensuring the supply of raw materials and fuel needed for trial production. Article 14. If a unit undertaking a project entrusts other units with the undertaking of parts of the project, Articles 12 and 13 may be referred to in defining the concrete content of "commitment" and "guarantee" for the contracting parties. Article 15. Comprehensive planning departments, units in charge of materials and complete sets of equipment shall arrange the supply of funds, materials and equipment needed by contract projects in the order of priority without leaving gaps. Units in charge of materials shall gradually enlarge the scope of supply of complete sets of equipment for contract projects on the basis of organizing supply of materials to the selected points. Article 16. Once norms for contract projects are fixed, they shall not change generally. The design and the budgetary estimate of a contract project may be revised and its norms readjusted according to the procedure for approval, if any of the following extraordinary conditions arises: (1) Major changes in resources, hydro-geology and engineering geology lead to change of the construction plan; (2) Various irresistible natural calamities bring great losses to a contract project; (3) A unified readjustment of prices by the state gives rise to great changes in the budgetary estimate; (4) Major adjustment is made in the state plan; (5) The design of a project is greatly revised. CHAPTER V RIGHTS, INTERESTS, REWARDS AND PENALITIES Article 17. The unit undertaking a contract project has the right to make the overall arrangements and necessary adjustments in the use of funds and the rate of progress of the project. If the amount of funds needed exceeds the funds fixed in the annual plan, the unit shall submit, in advance, a report to the superior unit for approval in accordance with its right of management over planning. Article 18. The surplus fund calculated according to the budgetary estimate approved by the state shall be shared 50-50, that is: 50% of the surplus fund shall be handed over to the state and the other 50% shall be retained by the enterprise. The part of the surplus fund retained by the enterprise shall be used for the enterprise's development fund, collective welfare fund and the income for workers' and staff fund at the percentage of 60-20-20, respectively. If any unit needs to adjust these percentages, it shall submit a report to a department in charge of the work under the State Council or the building commission and the planning commission under a province, a municipality or an autonomous region for approval. The surplus fund of a construction unit shall be retained and used as its income in accordance with the relevant stipulations of the state. If any of the contracting units needs to use the retained part of fund to build a new project, it shall go through the procedure of examination and approval in accordance with its rights of management over planning. Article 19. The enterprise undertaking a contract project shall link up responsibilities with the economic interests of its workers and staff members. Various ways may be adopted to assign the contract tasks to every shift, team and individual. Wages of workers and staff members are paid by following the principle of "more work, more pay" and "rewards for the diligent and penalties for the sluggard". No ceiling is fixed for workers' income for over-fulfillment of production targets. But the payment shall not exceed the total amount of manpower expenses fixed for the project. Article 20. After fulfilling the contract tasks, the surplus materials calculated according to the consumption quotas for materials shall be purchased or handled jointly by the department in charge of the project and departments in charge of materials, except those materials which the construction unit needs to retain for its own use. If complete sets of equipment have been imported, the surplus imported materials shall be distributed to the building and construction units after consultation. Article 21. If the state or a superior department asks to shorten the building time of a project, provisions of rewards for the shortening and penalties for the prolonging of the building time may be laid down in the contract after an agreement between the building and construction units has been reached through consultation and approval by the department in charge has been obtained. Bonuses shall be derived from the income as a result of putting the new project into production ahead of time or shall be paid with the surplus fund of the building unit from the contract project. Article 22. In undertaking the designing task of a contract project, if the designing unit can ensure excellent designing quality, hand in designed material and blueprints in time or ahead of time, co-ordinate well with construction work and make remarkable achievements in helping shorten the building time and reducing construction costs, it shall be rewarded by the department in charge with money taken from the surplus fund of the building unit from the contract project. Article 23. In undertaking a contract project, if the building time is prolonged, the quality of the project is poor and the cost exceeds the general budgetary estimate and the budget, the unit undertaking the project shall compensate for the losses. If great losses are brought about and the investment is overspent because of the failure of the department in charge or the building unit to provide funds and materials on time, the department or unit shall be held economically responsible. Concrete stipulations about rewards and penalties may be included in contracts. Units which make the state suffer great losses shall be held legally responsible. CHAPTER VI CHECK UP OF PROVISIONS OF CONTRACTS Article 24. If an agreement or a contract is signed, the two parties concerned shall implement its provisions strictly. During the period of construction of a project, the execution of the relevant agreement or contract shall be constantly supervised and checked on, and problems discovered shall be solved through timely consultation. If a problem cannot be solved through consultation, it shall be submitted to a superior organ for arbitration. Article 25. When a project is completed, it shall be promptly checked and accepted; the experience of construction shall be summed up, thus bringing the relevant contract to an end. CHAPTER VII SUPPLEMENTARY ARTICLES Article 26. Various departments under the State Council and building and planning commissions under a province, a municipality or an autonomous region shall in a timely manner sum up their experiences of construction of contract projects under the economic responsibility system, and strengthen their supervision over and checks on the work so as to gradually perfect it. Statistical systems shall be set up and amplified, and management based on fixed quotas strengthened at the same time. Article 27. Basing themselves on these Rules, departments under the State Council, provinces, municipalities and autonomous regions may work out detailed rules for the implementation of these Rules regarding the economic responsibility system in accordance with their concrete conditions, and submit them to the State Planning Commission for the record. Article 28. If an agreement or a contract was signed prior to the promulgation of the Rules, it shall be executed as it is. |
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