Regulations of Shanghai Municipality on Examination and Supervision over Budgets
Regulations of Shanghai Municipality on Examination and Supervision over Budgets
(September 28, 2021)
Chapter I General Provisions
Article 1
With a view to strengthening the examination and supervision over budgets, regulating government behaviors relating to revenues and expenditures, enhancing budget constraints, and bringing into play the role of budgets in promoting national economic and social development, these Regulations are formulated in accordance with the Budget Law of the People’s Republic of China, the Law of the People’s Republic of China on Supervision by the Standing Committees of the People’s Congresses at All Levels, and other relevant laws and administrative rules, and in the light of the actual circumstances of this Municipality.
Article 2
These Regulations apply to the examination and approval of budgets, budget adjustment plans, final accounts, the supervision over budget implementation, and relevant activities of the municipal and district people’s congresses, their standing committees, and the town/township people’s congresses. Budgets shall include the general public budgets, the budgets for government-managed funds, the budgets for state capital operations and the budgets for social insurance funds.
Article 3
The budget examination and supervision shall follow the principles of implementation in accordance with law, openness, transparency, comprehensiveness, standardization and efficiency.
Article 4
The municipal or district people’s congresses shall examine the corresponding-level draft general budgets and reports on the implementation of the general budgets, approve the corresponding-level budgets and reports on their implementation, alter or annul inappropriate resolutions on budgets or final accounts made by the standing committees of the corresponding-level people’s congresses (hereinafter referred to as the standing committees), and annul inappropriate decisions and orders on budgets or final accounts made by the corresponding-level governments.
The municipal and district standing committees shall supervise the implementation of the corresponding-level general budgets, examine and approve the corresponding-level budget adjustment plans and final accounts, and annul inappropriate decisions, orders and resolutions on budgets and final accounts made by the corresponding-level governments or by the next-lower-level people’s congresses and their standing committees.
The town/township people’s congresses shall examine and approve the corresponding-level budgets and reports on the implementation of the budgets, supervise the implementation of the corresponding-level budgets, examine and approve the corresponding-level budget adjustment plans, examine and approve the corresponding-level final accounts, and annul inappropriate decisions and orders on budgets or final accounts made by the corresponding-level governments. The town/township draft budgets, budget adjustment plans and draft final accounts, compiled by the district people’s governments with the approval of the Municipal People’s Government, shall be submitted to the town/township people’s congresses for examination and approval.
Article 5
The financial and economic committees of the municipal or district people’s congresses (hereinafter referred to as the financial and economic committees) shall, led by the corresponding-level people’s congresses and their standing committees, be responsible for initial examination of the corresponding-level preliminary plans for the draft budgets, the implementation of the budgets in the previous year, the corresponding-level preliminary budget adjustment plans and the draft final accounts, and put forward their initial examination results.
Article 6
The budget commissions of the standing committees of the municipal or district people’s congresses (hereinafter referred to as the budget commissions) shall assist the financial and economic committees in undertaking the specific work of the corresponding-level people’s congresses and their standing committees concerning the examination of the draft budgets, final accounts, budget adjustment plans and the supervision over the budget implementation, in undertaking specific work including the supervision over State-owned assets management and the follow-up supervision over the rectification of the prominent problems found in auditing, in undertaking specific work concerning online budget oversight, and in undertaking other specific budget matters assigned by the standing committees and the directors’ meeting, and matters in which the financial and economic committees require assistance.
The budget commissions may, with the consent of the directors’ meeting, request the relevant government departments and units to provide budgetary information, obtain relevant materials and explanations, and, with the approval of the directors’ meeting, investigate the use of the budget funds and special funds of all departments, budget units and major investment projects, and these government departments and units shall offer assistance and cooperation.
Article 7
The presidiums of the town/township people’s congresses (hereinafter referred to as the town/township presidiums) shall conduct initial examination and put forward their initial examination opinions on the corresponding-level preliminary plans for the draft budgets, the implementation of the budgets, the corresponding-level preliminary budget adjustment plans and the corresponding-level draft final accounts.
Chapter II The Priorities and Mode of Budget Examination and Supervision
Article 8
The examination and supervision of the fiscal policies shall prioritize the following:
how the fiscal policies implement the national and municipal policies, decisions and arrangements;
conformity with the economic and social development goals and the overall macro-control requirements;
strengthening of the management of the mid-term financial planning and guarantee of major national strategic tasks;
adequate solicitation of opinions and suggestions from deputies to the people’s congresses and various sectors of society in the process of formulating the fiscal policies; and
the rationality, feasibility and sustainability of the fiscal policies.
Article 9
The examination and supervision of the general public budget shall prioritize such contents as the total expenditure and its structure, key expenditures and major investment projects, departmental budgets, transfer payments, and budget revenue.
The examination and supervision of the total expenditure and its structure shall prioritize the following:
the implementation of expenditure and its structure as efforts to implement the national and municipal policies, decisions and arrangements;
total expenditure and its year-on-year increases or decreases; and
adjustment and optimization of the expenditure structure, enhancement of the efficiency of the financial fund allocation, the result of the fund use, etc.
The examination and supervision of the key expenditures and major investment projects shall prioritize the following:
the conformity of the key expenditure budgets with the expenditure policies;
the size changes and structural optimization of the key expenditures;
the decision-making on the key expenditures, the policy objectives and the results;
the conformity of the major investment projects with the national economic and social development planning; and
decision-making on the major investment projects, the investment arrangements and implementation, and the results.
The examination and supervision of the departmental budgets shall prioritize the following:
whether the incomes and expenditures of the department are all included in the budget;
whether the departmental budget conforms to the expenditure policies and departmental responsibilities;
the establishment of a project bank, the arrangements and results of the departmental budgets for key projects;
new asset allocation;
the use of carryover funds; and
the rectifications of the problems found in auditing.
The examination and supervision of transfer payment shall prioritize the following:
whether the transfer payment has guaranteed the matching of the fiscal powers with the expenditure responsibilities borne by the financial departments at all levels;
whether the transfer payment has promoted financial balance among districts and among towns/townships within a district in this Municipality and enhanced the community-level ability to guarantee public services；
the establishment of the transfer payment standards and optimization of the transfer payment structure；
the regular evaluation and withdrawal of special transfer payments; and
the issuance, utilization and performance of the transfer payment budgets.
The examination and supervision of the budget revenue shall prioritize the following:
the conformity of the budget revenue arrangements with the economic and social development goals and the country’s overall macro-control requirements;
matching of the tax revenues with their corresponding tax bases;
a true and complete picture of whether the budget revenue is collected in accordance with laws, rules and regulations;
the structural optimization and quality improvement of the budget revenue; and
whether the non-tax revenue management complies with laws.
Article 10
The examination and supervision of the budgets for government-managed funds shall prioritize the following:
whether the levy, utilization and term of government-managed funds comply with relevant laws, rules and regulations;
the reasonableness, feasibility and sustainability of the revenue and expenditure policies and the budget arrangements;
the utilization of expenditures of government-managed funds; and
the performance and evaluation-based adjustments of the government-managed funds.
Article 11
The examination and supervision of the budgets for state capital operations shall prioritize the following:
a complete budget scope and a standardized system;
2. submission to the State of all the proceeds from the state capital, proceeds from property right transfers, etc.
3. whether the targets and items of the expenditure comply with relevant laws, rules, regulations and policies;
4. the transfer of the state capital operation budgets to the general public budget;
5. the management of the government investment funds;
6. budget implementation management; and
7. the optimization of the state capital layout, enhancement of the operational stability and risk avoidance of state-owned enterprises, and the matching of the state capital operation budgets with the reforms of state capital and State-owned enterprises.
Article 12
The examination and supervision of the budgets for social insurance funds shall prioritize the following：
the income and expenditure arrangements of funds, financial subsidies and budget balance；
the budget arrangements to implement the social insurance policy;
the implementation of the national coordination policy of basic old-age insurance;
the performance and operation investment of the social insurance funds; and
the medium- and long-term forecasts of incomes and expenditures as well as sustainable operation.
Article 13
The examination and supervision of the local government debts shall prioritize the following:
Whether the local government debt is included in the budget management;
the reasonableness of the limit to the new general debt and the limit to the special debt of the local people’s government;
the reasonableness of the new debt size;
the compliance with the regulations of the local people’s government’s general debt and the scientificity of the special government debt;
the reserves for the local people’s government’s bond projects, including project types, investment amounts and annual financial requirements;
bond issuance and utilization, the performance and fund management of the debt projects, and the implementation of major policies;
the repayment of the local people’s government’s debts and performance of the debt project; and
the active and steady defusing of the local people’s government’s debt risks.
Article 14
The municipal and district people’s governments shall strengthen administration of the fiscal policies and, before promulgation of their major local fiscal policies, make reports to the standing committees of the corresponding-level people’s congresses; upon the promulgation, the major local fiscal policies shall be promptly reported to the standing committees of the corresponding-level people’s congress for filing on record.
The documents of major fiscal revenue and expenditure policies formulated by the financial departments of the municipal or district people’s governments shall be delivered to the corresponding-level financial and economic committees and the budget commissions within 15 days upon promulgation.
Article 15
The municipal and district people’s congresses and their standing committees shall strengthen the budget examination of major investment projects, promote the governments to improve the budget presentation of major investment projects, strengthen the supervision over the budget implementation of major investment projects, and pay close attention to the implementation and performance management of major investment projects.
When the municipal and district people’s governments report the implementation of their national economic and social development plans and the budget implementation to the corresponding-level standing committees, they shall also report the implementation of the plans and budgets for major investment projects. Where any adjustments to the fund arrangements for major investment projects in budget implementation are made by relevant departments of the municipal and district governments, such adjustments shall be promptly reported to the corresponding-level financial and economic committees and budget commissions.
Article 16
The municipal and district standing committees and town/township people’s congresses shall supervise the corresponding-level governments and their departments to promptly disclose their budget information in accordance with laws.
The budget information of the municipal, district, and town/township people’s governments and all their departments and units shall be disclosed to the public in accordance with laws, and shall accept public oversight.
Except those involving state secrets, the budgets, budget adjustments, final accounts and the reports and statements on the budget implementation approved by the corresponding-level people’s congresses or their standing committees shall be disclosed to the public by the financial departments of the corresponding-level government within 20 days upon approval. The departmental budgets, the final accounts and the statements approved by the financial departments of the corresponding-level governments shall be disclosed to the public by the relevant departments within 20 days upon approval; the departmental budgets, final accounts and statements approved by the corresponding-level competent budget departments shall be disclosed to the public by the relevant units within 20 days upon approval. The expenditures of the budgets and final accounts shall be disclosed down to specific items based on function classifications, and the basic expenditures of the general public budgets shall be disclosed down to specific sections based on economic classifications.
The people’s governments at all levels shall disclose their general transfer payments and special transfer payments, with all the budgets and final accounts of the special transfer payments to the lower-level governments disclosed down to the specific projects, and shall disclose the approved quota, balance, issuance, utilization and repayment of the debts and other relevant information of the corresponding regions. The people’s governments at all levels shall disclose all the relevant fiscal and taxation systems, and gradually disclose such information as arrangement and utilization of major investment-project funds and the government consolidated financial reports.
The information disclosed by all departments and units shall include their responsibilities, organizational structures, revenues and expenditures of the budgets, and the department operating expenditures. All departments and units shall disclose the problems found in auditing and their rectifications, the information concerning government procurement, budget implementation, and the possession and utilization of State-owned assets.
The budget information shall be disclosed in a unified and standardized way, and convenient for public inquiries. The budget information shall be disclosed to the public on the main platforms including the government, department or unit web portals, on which columns of budget publicity shall be set up for centralized disclosure of information.
Article 17
The municipal and district standing committees and the town/township people’s congresses shall monitor the budget implementation management of the corresponding-level governments and their departments, strengthen the review and supervision over the performance targets and the performance evaluation results of the key expenditures and major projects.
The people’s governments at all levels and their departments and units shall implement comprehensive budget implementation management, strengthen prior performance evaluation, rigorously formulate the performance targets, and improve the budget implementation indicator system, and shall make the best use of performance evaluation results, promote the integration of performance evaluation results with policy improvement, budget arrangement and better management, and submit, in a timely manner, important performance evaluation results and draft final accounts to the corresponding-level people’s congress or its standing committee for review.
Article 18
The municipal and district standing committees may supervise the budgets and final accounts at the corresponding levels and the next lower levels through the hearing and deliberation of the governments’ special work reports, inspection of law enforcement, inquiries, interpellations, investigation of special issues, etc.
The town/township presidiums may supervise the corresponding-level budgets and final accounts by arranging deputies to the people’s congresses to hear and discuss the governments’ work reports or special work reports, and conduct inspection tours, survey and research on special subjects, inspection of law enforcement, etc.
Article 19
The standing committees of the municipal and district people’s congresses shall establish a mechanism of hearing the opinions and suggestions from the deputies to the people’s congresses and all circles of society before examining the budgets.
The financial and economic committees and the budget commissions shall extensively solicit opinions and suggestions from corresponding-level deputies to the people’s congresses and the parties concerned, and organize corresponding-level deputies to the people’s congresses to participate in relevant symposiums, briefings and preliminary budget examination meetings when conducting preliminary examination and supervision. The financial and economic committees and the budget commissions may set up groups of specialized representatives for budget examination and organize corresponding-level deputies to the people’s congresses to participate in budget examination and supervision, and may establish an expert consultant mechanism for budget examination by engaging budget examination and supervision consultants or inviting relevant experts to assist in the budget examination and supervision.
The financial and economic committees, the budget commissions, and relevant departments of the people’s governments at all levels shall provide corresponding-level deputies to the people’s congresses with consultation and other services for their examination and approval of the budgets.
Prior to holding sessions to examine the draft budgets, the district or town/township people’s congresses shall organize the corresponding-level deputies to hear the opinions from their constituencies and all circles of society through various means.
In the process of preparing budgets, formulating policies and promoting reforms, the financial departments of governments at all levels shall solicit opinions and suggestions from deputies to the people’s congress by such means as symposiums, briefings, seminars, targeted investigation, handling of draft bills, and invitation of deputies to people’s congresses for inspection.
Article 20
The municipal and district financial and economic committees, budget commissions, and specialized commissions and relevant working offices of the standing committees shall make joint efforts to carry out budget examination and supervision and establish and improve a collaboration mechanism so as to utilize the professional advantages of those committees and commissions.
The specialized commissions and the relevant working offices of the standing committees of the municipal and district people’s congresses shall combine legislation, supervision and other key work with the budget examination and supervision, and shall take the management and performance of the financial funds of relevant departments as an important indicator and reference in supervising the performance and policy implementation of the governments.
The specialized commissions of the municipal and district people’s congresses and the relevant working offices of the standing committees may carry out special examination and put forward opinions on the key expenditures, major projects and important-policy-related fund arrangements and utilization of their corresponding contact departments. Such opinions are crucial references for the financial and economic committees to put forward their initial examination opinions and reports the examination results. The municipal and district budget commissions shall provide relevant supporting services.
Article 21
The municipal and district standing committees and the corresponding-level governments shall jointly promote budget network supervision to realize the informationization and networking of the budget examination and supervision.
The municipal and district standing committees shall establish a budget network supervision system and perfect its functions in accordance with the requirements for comprehensive examination and thorough supervision, and shall apply the system to strengthen the examination and supervision over the budgets and relevant policies, and enhance the relevance and effectiveness of the budget examination and supervision.
A real-time dynamic online early-warning system and an online collaborative problem-solving mechanism for financial and departmental budgets shall be established in this Municipality. The municipal financial and budget departments shall receive and process early warnings and give feedback through the budget network supervision system. The specialized commissions and the budget commissions of the Municipal People’s Congress shall follow the whole problem-solving process of the early warnings in the system.
An online collaborative supervision mechanism for the rectification of prominent problems found in auditing shall be established in this Municipality. The audit department of the Municipal People’s Government shall provide an online list of the problems needed to be rectified, while the auditees shall upload their progress in rectification. The specialized commissions and the budget commissions of the Municipal People’s Congress shall track such progress and supervise the rectification of the prominent problems found in the auditing.
Relevant departments of the municipal and district governments shall provide the corresponding-level standing committees with data and information concerning the financial budget, state-owned asset management, macro-economy, finance, auditing, taxation, statistics and social security through the budget network supervision system, and shall establish a sound data sharing mechanism.
The standing committees of the municipal and district people’s congresses and their relevant departments of the corresponding-level governments shall, in accordance with laws, safeguard the information security and enhance information management of confidential data to ensure data security.
Chapter III Examination and Approval of Budgets
Article 22
The people’s congresses at all levels and their standing committees shall examine and supervise whether the revenues and expenditures of the corresponding-level governments are all included in the budgets.
All the government revenues and expenditures shall be listed in the budgets by the governments at all levels and all their departments and units according to law, and shall not be concealed or incompletely listed. Overall plans shall be made on the budgets for the government-managed funds, the budgets for State-owned capital operations and the general public budgets pursuant to the relevant state provisions.
Article 23
The people’s congresses at all levels and their standing committees shall examine and supervise whether the budgets compiled by the corresponding-level governments follow the principles of making overall plans and taking all factors into consideration, practicing economy and thrift, being realistic, and emphasizing performance and balance between revenues and expenditures.
The draft budget shall comply with the following requirements：
The draft general public budget shall present the budget revenue and expenditure statement, the transfer payment budget statement, the capital construction expenditure statement, the government debt statement, etc., and shall indicate the budget arrangement of revenues and expenditures as well as the performance target of the transfer payment.
The draft budget for government-managed funds shall be compiled and explained separately by fund items. Expenditures of government-managed funds shall be presented down to the specific projects, indicating the fund carryover balance and the performance target.
The income of the draft budget for State-owned capital operations shall be listed down to the industries or enterprises, indicating the overall financial statuses of the enterprises included in the budget in the previous year. The expenditure of the draft budget for State-owned capital operations shall be presented down to the direction and use of the funds and indicate the basis of the project arrangements and the performance targets.
The draft budget for social insurance funds shall be prepared by insurance coverage types and indicate the sustainability of the social insurance fund.
The draft budget shall state situations including the local government debt limit, balance, debt revenue, scheduled expenditures, debt service, and issuance expenses.
The people’s governments at all levels shall establish and improve the system of quota standards for basic budget expenditures, the system of standards for project expenditures, and the system for evaluation of budget implementation.
The people’s governments at all levels shall establish multi-year budgeting balance mechanisms. The financial departments shall, together with various departments, compile the mid-term financial plans of the governments; all departments shall compile their mid-term financial plans.
Article 24
The financial departments of the municipal or district people’s governments shall report their budget compilation to and solicit opinions from the corresponding-level financial and economic committees and budget commissions.
The municipal and district financial and economic committees and budget commissions shall, during the budget compilation, know the compiling of the corresponding-level draft budgets and the departmental budgets, hear opinions from the relevant parties by means of seminars, feasibility study meetings and hearings, and give feedback to the financial departments of the corresponding-level governments.
Article 25
The financial departments of the municipal or district people’s governments shall, 30 days before the sessions of the corresponding-level people’s congresses, submit their preliminary plans for the draft budgets to the financial and economic committees of the corresponding-level people’s congresses for initial examination. During the initial examination by the municipal and district financial and economic committees and budget commissions, the persons in charge from the government financial and other relevant departments shall be present to make explanations and hear the review opinions.
The municipal and district financial and economic committees shall, 15 days before the sessions of the people’s congresses, put forward their initial examination opinions and give feedback to the financial departments of the corresponding-level governments. The government financial departments shall, five days before the sessions of the people’s congresses, deliver written feedback on their implementation of such opinions. The initial examination opinions and the reports of their implementation shall be printed and distributed to the deputies to the corresponding-level people’s congresses during the sessions of the people’s congresses.
The financial departments of the town/township people’s governments shall, 15 days before the sessions of the people’s congresses, submit their preliminary plans for the corresponding-level draft budgets and the implementation of the budgets in the previous year to the town/township presidiums for initial examination.
Article 26
Where the preliminary plans for the draft budgets are submitted, the following relevant materials and notes/explanations shall also be submitted according to law:
the revenue and expenditure statements of the general public budgets, the budgets for government-managed funds, the budgets for State-owned capital operations and the budgets for social insurance funds;
the departmental budget sheets;
the schedules of the transfer payments to the lower-level governments;
the tables of categories of key expenditures and the lists of major investment projects as approved by the governments in the draft budgets;
government debt balance and limit, government bond issuance, and debt service;
the statements of the special fund expenditures in the general public budgets;
government procurement budgets;
the management of the State-owned assets;
relevant notes on budget compilation; and
other materials and the corresponding notes.
Article 27
The initial examination on the preliminary plans for the draft budgets and the implementation of the budgets in the previous year shall prioritize the following:
whether or not the previous year’s budget implementation meets the requirements by the budget resolutions of the corresponding-level people’s congresses;
whether or not the budget arrangements comply with the law and the guidelines and policies on national economic and social development, and whether or not the revenue-expenditure policies are practical;
whether or not the government-approved budget arrangements for key expenditures and major investment projects are reasonable and feasible;
whether or not the compilation of the draft budgets is complete and the expenditures under the general public budgets classified by their functions are compiled down to items and the general public budgets classified by their economic nature are compiled down to sections; whether or not the expenditures under the budgets for government-managed funds, the budgets for State-owned capital operations and the budgets for social insurance funds classified by their functions are compiled down to items;
whether or not the budgets for the transfer expenditures to the lower-level governments are regulated and appropriate;
whether or not the debts borrowed under the budget arrangements are lawful and rational, and whether or not there are practical repayment plans and stable and reliable funds for repayment of the debts;
whether or not the notes on the previous year’s budget implementation and this year’s draft budgets are comprehensive and clear; and
whether or not the explanations for the important matters related to the budgets are clear.
Article 28
The municipal and district financial and economic committees and budget commissions shall, before the sessions of the corresponding-level people’s congresses, organize the corresponding-level government departments of finance, State-owned assets administration, human resources and social security, health care security, etc. to explain the draft budgets to the deputies to the corresponding-level people’s congresses.
Article 29
The municipal and district standing committees or their directors’ meetings shall, before the sessions of the corresponding-level people’s congresses, hear the initial examination and opinions from the corresponding-level financial and economic committees and budget commissions.
Article 30
The people’s governments at all levels shall generally, five days before the sessions of the corresponding-level people’s congresses, submit the official texts of the draft budgets and the reports thereon to the corresponding-level people’s congresses or the town/township presidiums.
Article 31
During the sessions of the municipal or district people’s congresses, the financial and economic committees shall, pursuant to the review opinions of the deputies to the corresponding-level people’s congresses and the initial examination opinions, submit the reports on the examination results of the draft general budgets and the previous year’s implementation of the general budgets. The reports on the examination results shall include assessments on the previous year’s budget implementation and the implementation of the budget resolutions of the corresponding-level people’s congresses, and on this year’s draft budgets; and shall include suggestions on whether to approve the draft budgets and the budget reports by the corresponding-level people’s congresses; and also include opinions and proposals on the implementation of the annual budgets, improvement of the management and performance of the budgets, and enhancement of the supervision over the budgets and other relevant matters. The reports on the examination results shall be printed and distributed to all the deputies to the people’s congresses after the presidiums of the sessions adopt them.
The committees of national economic and social development and budget examination, which shall be set up at the first sessions of the municipal or district people’s congresses, shall submit their reports on the examination results about the draft general budgets and the previous year’s implementation of the general budgets to the presidiums of the sessions pursuant to the review opinions of the corresponding-level people’s congress and in the light of the initial examination opinions.
The financial budget examination committees, which shall be set up at the sessions of the town/township people’s congresses, shall put forward their examination opinions on the draft budgets.
During the sessions of the people’s congresses at all levels when the deputies to the people’s congresses review the draft budgets and the reports on the previous year’s budget implementation, the financial and other relevant departments of the corresponding-level governments shall be present, hear the opinions and reply to the inquiries by deputies to the people’s congresses. They shall give timely feedbacks to the opinions by the deputies to the people’s congresses.
Article 32
After the municipal and district people’s congresses approve the corresponding-level budgets, the financial departments of the corresponding-level governments shall send copies of the approved budgets of the corresponding-level departments and the approved budgets for the transfer payments to the lower-level governments to the corresponding-level financial and economic committees and budget commissions.
The municipal or district people’s governments shall collect the budgets of all the next-lower-level governments and submit them to the next-higher-level governments and the standing committees of the corresponding-level people’s congresses for record. Where the municipal or district people’s governments deem that the budgets submitted for record by the next-lower-level governments contravene laws or administrative rules, or contain other inappropriate contents, and therefore the resolutions of approving the budgets have to be canceled, the said governments shall submit the matter to the standing committees of the corresponding-level people’s congresses for deliberation and decision.
Chapter IV Supervision over Budget Implementation
Article 33
The municipal and district standing committees and the town/township presidiums shall strengthen the supervision over budget implementation. The people’s governments at all levels, all their departments and all units shall subject themselves to supervision, and fully and truthfully report their budget implementation and provide necessary materials.
Article 34
Supervision over budget implementation shall include the following major areas:
the implementation of the resolutions and decisions made by the corresponding-level people’s congresses and their standing committees;
the arrangements of the budgetary revenues;
the approval of budgets and the allocations of the expenditures;
the budget systems, budget arrangements and budget implementation of all budget departments and units;
the arrangements of the key expenditures and key investment projects decided by the governments, and the availability and implementation of the funds;
the management of the surplus revenues, the insufficient revenues and the handling thereof;
the use of the reserve funds, budget circulating funds, budget stabilization funds and carryover funds;
the implementation of the government procurement budgets, and the management of the budgets for government-purchased services;
the transfer payments to the lower-level financial departments;
the management of the government debts;
during the budget implementation, whether the handling of the funds that have to be transferred for use among the departments’ and units’ different budgetary accounting items complies with the provisions of the government financial departments; and
other major items and specific issues in implementing the budgets.
Article 35
The municipal and district standing committees and the town/township people’s congresses shall, from June to September each year, hear and deliberate the reports made by the corresponding-level governments on their budget implementation in the previous stage of this year.
The financial departments of the municipal and district people’s governments shall, 30 days prior to the sessions held by the corresponding-level standing committees to hear and deliberate the reports on the budget implementation in the previous stage of this year, submit such reports to the corresponding-level financial and economic committees and budget commissions. The financial departments of town/township people’s governments shall, 10 days prior to the sessions of the town/township people’s congresses to hear and deliberate the reports on the budget implementation in the previous stage of this year, submit such reports to the town/township presidiums.
Article 36
The review opinions by members of the municipal and district standing committees on the reports on the budget implementation shall be provided to the corresponding-level governments for the latter’s consideration and handling. The municipal and district people’s governments shall submit reports on their consideration and handling in writing to the corresponding-level standing committees.
The reports on the budget implementation, the standing committees’ review opinions and the corresponding-level governments’ consideration and handling of the review opinions or their implementation of the resolutions shall be submitted to the corresponding-level people’s congresses and made public.
Article 37
Prior to the municipal and district standing committees’ hearing and deliberation of the reports on budget implementation in the previous stage of this year, the budget commissions shall hear the reports on the budget implementation and management by the relevant departments of the corresponding-level governments, and give feedback to the financial departments of the corresponding-level governments, which shall submit reports on their consideration and handling in writing within 30 days.
Article 38
The financial departments of the governments at all levels shall, in accordance with relevant state provisions, prepare annual consolidated financial reports of the governments on an accrual basis, which reflect the overall financial conditions, operations, and mid- and long-term financial sustainability of the governments, and submit them to the standing committees of the corresponding-level people’s congresses or the town/township presidiums for record.
Chapter V Examination and Approval of Budget Adjustments
Article 39
Where general public budgets, the budgets for government-managed funds, the budgets for State-owned capital operations, and budgets for social insurance funds approved by the people’s congresses at all levels have to be adjusted in accordance with the Budget Law of the People’s Republic of China during the budget implementation, governments at all levels shall compile budget adjustment plans. The municipal or district people’s governments shall submit such plans to the corresponding-level standing committees for examination and approval, while town/township people’s governments shall submit their plans to the corresponding-level people’s congresses for examination and approval.
Article 40
The financial departments of the municipal or district people’s governments shall report their preliminary budget adjustment plans to the corresponding-level financial and economic committees and budget commissions in time. The government financial departments shall, 30 days before the sessions of the municipal or district standing committees for examining and adopting the budget adjustment plans, submit their preliminary budget adjustment plans to the corresponding-level financial and economic committees for initial examination.
The financial departments of town/township people’s governments shall, 15 days before the sessions of the standing committees of the town/township congresses for examining and adopting the budget adjustment plans, submit their preliminary budget adjustment plans to the town/township presidiums for initial examination.
Article 41
The municipal and district standing committees and the town/township people’s congresses shall examine the following major contents of the corresponding-level budget adjustment plans:
the reasons and basis for the adjustments;
the items and amounts to be adjusted;
the balance between revenue and expenditure; and
whether there is a clear explanation on the major issues concerning the budget adjustments.
Article 42
The municipal and district financial and economic committees shall submit the reports on the examination results about the corresponding-level budget adjustment plans to the corresponding-level standing committees.
The reports on the examination results shall include:
the assessments on whether the budget adjustment plans comply with the Budget Law of the People’s Republic of China；
the revenues and expenditures of the budget adjustments;
the assessments on whether the adjusted items and the fund arrangements are reasonable;
the suggestions for the corresponding-level standing committees on whether to approve the budget adjustment plans; and
the comments and suggestions on the adjusted budgets.
Article 43
Where the budget adjustment decisions are made by governments at all levels without going through legal procedures, the corresponding-level people’s congresses and their standing committees or the higher-level governments shall order changes or annulment of the decisions.
Article 44
The budget transfer shall be put under strict control. The budget expenditures of all departments and units shall comply with their budgets. Where a transfer is necessary due to a major event, such transfer shall be handled in strict accordance with the prescribed procedures.
Where important measures for increasing fiscal revenues and expenditures are introduced during the budget implementation, or major changes occur in the structure of the budget revenues and expenditures, the financial departments of the municipal or district people’s governments shall report them to the corresponding-level budget commissions in a timely manner. The municipal and district budget commissions shall inform the corresponding-level financial and economic committees of the relevant information, and shall report to the corresponding-level standing committees if necessary.
Chapter VI Examination and Approval of Final Accounts
Article 45
After the financial departments of the municipal or district people’s governments prepare the corresponding-level draft final accounts, they shall be audited by the audit departments of the corresponding-level government before being submitted to the corresponding-level governments for approval. The governments shall submit the draft final accounts to the standing committees of the corresponding-level people’s congresses for examination and approval and make reports on their final accounts. The town/township people’s governments shall prepare the corresponding-level draft final accounts, and submit them to the corresponding-level people’s congresses for examination and approval.
The draft final account shall be prepared in accordance with the items set out in the budget approved by the corresponding-level people’s congress and shall be divided according to the budgetary amounts, the adjusted budgetary amounts and the final account amounts. The major modifications shall be explained. The general public budget classified by their functions shall be compiled down to items. Basic expenditures classified by their economic nature shall be compiled down to sections. The expenditures under the budgets for government-managed funds, the budgets for State-owned capital operations and the budgets for social insurance funds classified by their functions shall be compiled down to items.
The reports on the final accounts shall prioritize the budget implementation, the key expenditures, the utilization and performance of major investment projects in the previous year as approved by the corresponding-level people’s congresses, as well as the main causes of failing to achieve the budgeted goals and the existing major problems. The municipal or district people’s governments shall report to the corresponding-level standing committees on specific matters concerning the implementation of accrual basis prescribed by the State Council.
Article 46
The financial departments of the municipal and district people’s governments shall, 30 days before the sessions of the corresponding-level standing committees to examine and approve the corresponding-level draft final accounts, submit the previous year’s draft final accounts to the corresponding-level financial and economic committees for initial examination.
The financial departments of the town/township people’s governments shall, 10 days before the sessions of the town/township people’s congresses to examine and approve the corresponding-level draft final accounts, submit the previous year’s draft final accounts to the town/township presidiums for initial examination.
Article 47
The municipal and district standing committees and the town/township people’s congresses shall prioritize the examination of the following contents of the corresponding-level draft final accounts:
budget revenues;
2. the implementation of the expenditure policies as well as the use and performance of the key expenditure and major investment project funds;
3. the use of carry-over funds;
4. fund balances;
5. the adjustment and implementation of the corresponding-level budget;
6. the arrangement and implementation of the transfer payment;
7. the size, structure, use and repayment of the approved borrowed debt;
8. the size and use of the working capital of the corresponding-level budget;
9. the use of the corresponding-level reserve fund;
10. the arrangements for the surplus revenues, and the size and use of the budget stabilization fund;
11. the implementation of the budget resolution approved by the corresponding-level people’s congress; and
12. other important circumstances related to the final accounts.
Article 48
The municipal and district financial and economic committees shall deliver reports on the examination results about the corresponding-level draft final accounts to the corresponding-level standing committees.
The reports on the examination results shall include:
the revenues and expenditures of the corresponding-level final accounts;
the general evaluation of the corresponding-level final accounts;
3. the suggestions for the corresponding-level standing committees on whether to approve the final accounts; and
4. the opinions and proposals on solving the existing problems in the corresponding-level final accounts.
Article 49
After the corresponding-level final accounts have been approved by the municipal or district standing committees, the relevant government financial departments shall, within 20 days, reply to all the corresponding-level departments to approve or disapprove their final accounts, and meanwhile send the approved departmental final accounts to the corresponding-level financial and economic committees and budget commissions.
The municipal and district people’s governments shall, in a timely manner, collect the final accounts of the next-lower-level governments and submit them to the next-higher-level governments and the standing committees of the corresponding-level people’s congresses for record. Where the higher-level governments deem that the final accounts submitted for record contravene laws or administrative rules or are otherwise inappropriate, and that the resolutions approving the said final accounts shall be revoked, the said governments shall submit the matter to the standing committees of the corresponding-level people’s congresses for deliberation and decision.
Chapter VII Examination and Supervision over Local Government Debt
Article 50
The municipal and district people’s congresses and their standing committees shall standardize the working procedures and improve the working mechanism by focusing on the examination and approval of the draft budgets, the budget adjustment plans and the budget final accounts of the corresponding-level governments, as well as the supervision over budget implementation, and shall utilize a combination of supervision methods to strengthen the examination and supervision over local government debts.
Heads of the relevant departments shall be present, hear the opinions and reply to the inquiries according to relevant provisions when the financial and economic committees and other relevant special committees/commissions of the municipal and district people’s congresses conduct initial examination of the preliminary plans for the draft budgets, the preliminary budget adjustment plans and the draft final accounts of the corresponding-level governments, or carry out thematic deliberation of the government debts. The municipal and district budget commissions shall strengthen investigation and study of the corresponding-level government debts, and make targeted recommendations
The municipal and district financial departments shall, in each quarter or every six months, provide information including the government bond issuance, fund use and government debt service to the corresponding-level financial and economic committees and budget commissions.
The municipal and district financial departments shall, in every six months, report their management of government debts to the corresponding-level economic and financial committees and budget commissions, explaining the use of government bond issuance, fund management, project pool construction and debt risks.
Article 51
The municipal and district people’s congresses and their standing committees shall promote the governments at all levels to improve the draft budgets, the budget adjustment plans, and the draft final accounts concerning debts:
The limits and balances of the general and special debts, debt maturity, and debt service shall be reflected in the previous year’s government debt implementation and final accounts table;
The government debt limit and its projected balance, and the annual new debt arrangements shall be reflected in this year’s arrangement table of government debt budget revenues and expenditures;
The debt ratio and other debt risk assessment indicators shall be reflected in the government debt indicators table;
The special debt table shall reflect the special government bond revenue and expenditure, and the debt service of the corresponding-level governments in the previous year; and
The budget adjustment plans submitted to the standing committee for examination and approval due to debt borrowing shall reflect the government debt limit and balance, the size of the new debt and the debt limit allocation.
Article 52
The municipal and district people’s congresses and their standing committees shall promote refinement of the contents concerning debts in the budget reports, the budget adjustment plans and the final account reports of governments at all levels:
The budget report shall include the previous year’s government bond issuance, use and repayment of funds, debt risks, the main use of the debt borrowed this year and the debt service plans;
The budget adjustment plans shall include the necessity and legality of the borrowed debt of the corresponding-level government, the overall size, structure and risks of the debts of the region and the corresponding-level governments, the main use of the government debt funds at this level, and the project arrangements; and
The final account report shall include the size, structure, use, repayment and project implementation and performance of the corresponding-level government debts as well as the availability of funds for major construction projects.
Article 53
The municipal and district people’s congresses and their standing committees shall strengthen the supervision over the corresponding-level government debt risk control, promote the disclosure of government debt information, and strengthen the supervision over the financing by the governments and their departments, and local State-owned enterprises. The municipal and district people’s governments shall establish mechanisms for debt information disclosure, debt risk assessment and early warning, and emergency handling as well as an accountability system.
Chapter VIII Audit Supervision over Budgets
Article 54
The municipal and district budget commissions shall increase information communication and work collaboration with the audit departments of the corresponding-level governments. The audit departments shall prioritize the auditing of the expenditure budgets and policy implementation, and strengthen performance auditing, and shall, in the study of the next year’s auditing priorities and key projects, be connected with the key supervision targets of the standing committees so as to form supervisory synergy.
The municipal and district standing committees may, when supervising the budget implementation, request the corresponding-level governments to conduct a special audit or an audit investigation on specific matters, and report the audit results to the standing committees.
Article 55
The municipal and district audit departments shall, in accordance with the requirements for authenticity, legality and efficiency, implement audit supervision over the corresponding-level budget implementation, other financial revenues and expenditures, and draft final account, and shall support the corresponding-level standing committee to examine and supervise the budget implementation and the final account.
Before the corresponding-level standing committees hold sessions to examine and approve the corresponding-level draft final accounts, the municipal and district people’s governments’ audit departments shall report to the corresponding-level financial and economic committees and budget commissions on the auditing of the budget implementation and other financial revenues and expenditures.
Article 56
The municipal and district standing committees shall hear and deliberate the corresponding-level governments’ audit reports on the previous year’s budget implementation and other financial revenues and expenditure.
The audit report shall prioritize the following:
the basic information on the budget implementation, draft final account, implementation of important policies, and financial fund performance of the corresponding-level government, as well as audits of other financial revenues and expenditure;
the problems found in auditing and the problem list;
the analysis of the causes of the problems found in auditing, and audit observations and recommendations; and
other important circumstances needed to be reported.
Article 57
The municipal and district standing committees shall hear and deliberate the reports of the corresponding-level governments on their rectifications of the problems found in auditing, may conduct special inquiries into the rectifications of the problems found in auditing, and when hearing the said reports, may carry out satisfaction evaluation of the rectification results.
The report on the rectification of the problems found in auditing shall correspond to the audit report, focusing on reflecting the rectification of the prominent problems found in auditing, and shall provide a list of the individual rectification results of the prominent problems found in auditing and a list of the rectification of the problems found in auditing the departmental budget implementation. The report shall focus on reflecting the causes for the remaining problems and the possible countermeasures, and strengthen the closed-loop management of those problems.
Article 58
The municipal and district standing committees shall conduct follow-up supervision over the rectification of the problems found in auditing, and may use a combination of hearing and deliberating special government reports, law enforcement inspections, inquiries, questioning, and investigation of specific issues so as to exert greater supervision, and urge rectification of the problems, thus establishing and improving a long-term mechanism for rectification and an accountability mechanism.
The municipal and district budget commissions shall, in accordance with the relevant resolutions and review opinions of the corresponding-level standing committees, and in the light of the nature of the problems found in auditing, the fund size and the previous rectifications, determine the prominent issues and responsible departments subject to follow-up supervision, organize follow-up supervision, and submit an investigation report to the corresponding-level standing committee.
A coordination mechanism that integrates the budget examination and supervision of the people’s congress with the discipline inspection and supervision, audit supervision, investor supervision and other types of supervision shall be established in this Municipality to enhance information sharing and promote the rectification of problems found in auditing.
Article 59
The review opinions on the audit reports made by members of the municipal and district standing committees shall be sent to the corresponding-level governments for consideration and handling. The municipal and district people’s governments shall submit their reports on the consideration and handling in writing to the corresponding-level standing committees.
The audit reports, rectification reports and review opinions heard by the municipal and district standing committees, the reports on the consideration and handling of the review opinions or on the implementation of the resolutions by the corresponding-level governments shall be briefed to the deputies to the corresponding-level people’s congresses and publicized.
The municipal and district standing committees may, when deeming it necessary, adopt resolutions on the audit reports and the reports on the rectifications. The municipal and district people’s governments shall report the implementation of the resolutions to the corresponding-level standing committees within the time limit prescribed by the resolutions.
Article 60
The financial departments of the municipal and district people’s governments shall, in the light of the prominent problems found in auditing and their rectifications, improve the relevant policies and the budget management system, optimize the annual budget arrangements, and treat the audit results and rectifications as important references to optimize financial resources allocation and improve the expenditure policies. In arranging the budget for the next year, the financial departments of the municipal and district people’s governments shall focus on examining the rectification results of the departments and units that have repeatedly committed outstanding problems and failed to make any or adequate rectifications.
Chapter IX Legal Liability
Article 61
Where laws or administrative rules have already had provisions that regulate violations of these Regulations, such provisions shall prevail.
Article 62
The governments at all levels or their relevant departments that violate these Regulations shall be ordered to make corrections. The persons in charge directly responsible and other persons directly responsible shall be subject to administrative liabilities according to law.
Article 63
Any citizens, legal persons, or other organizations that discover any violation of these Regulations may file reports or complaints to the relevant state organs in accordance with the law. Where the units or individuals being reported or complained against suppress or retaliate on those who file such reports or complaints, the higher-level competent departments or the units to which the said individuals belong shall take administrative disciplinary actions against such units or individuals; where their acts constitute a crime, they shall be subject to criminal liability according to law.
Chapter X Supplementary Provisions
Article 64
The district standing committees and the town/township people’s congresses may, in accordance with the provisions of these Regulations and in the light of the actual circumstances of their administrative regions, formulate specific measures with regard to budget examination and supervision.
The Municipal Standing Committee shall strengthen guidance over the district standing committees’ work of budget examination and supervision, and the municipal and district standing committees shall coordinate with each other to jointly do well the people’s congresses’ work of budget examination and supervision.
Article 65
These Regulations shall be effective as of September 28, 2021. The Regulations of Shanghai Municipality on Examination and Supervision over Budgets adopted at the 38th Session of the Standing Committee of the 14th Shanghai Municipal People’s Congress on June 23, 2017 shall be repealed at the same time.