State and market in public service provision: opportunities and traps for institutional change in rural China

Abstract

International experience tells that public services often fail to work for those in need. To make things work requires complex institutional changes that are difficult to come by, let alone sustain. This paper examines the situation of rural public service provision in China and a local attempt to revamp the service provision institution through adjusting the mix of state and the market. It reveals the dialectical process of policy evolution whereby innovation, and resistance to it, has emerged.

Keywords:

• Public service unit reform
• township government reform
• public services for the poor
• institutional change
• China

Acknowledgements

The author would like to thank the Hong Kong Research Grant Council for funding the research on township fiscal institutional change (RGC reference: CityU 1064/02H) from which this paper draws, and the Fulbright Scholarship Program which financed my stay at UC, Berkeley where I drafted the paper. Fieldwork was conducted during 2002–07 in Hubei, Anhui and Guangdong provinces, and in Beijing. Many individuals have helped in this process, in particular Jingyao Wang and Licai Wu. Earlier versions of the paper were presented at the Provincial China Workshop organized by the University of Technology, Sydney and Uppsala University, Sweden, at Taiyuan, China in September 2006, and at the ‘State Capacity’ conference at the City University of Hong Kong in April 2007. Comments and suggestions by participants, in particular Vivienne Shue, David Goodman, Christine Wong, Maria Heimer and Minglu Chen are much appreciated. Research assistance was provided by Kin-on Li in Hong Kong, and Yamin Xu at Berkeley.

Linda Chelan Li is Associate Professor at the Department of Public and Social Administration, City University of Hong Kong, specializing in Chinese inter-governmental relations, rural public finance and government reforms and institutional change. She is author of Centre and Province: China. Power as Non-zero-sum (Clarendon, 1998, 2002) and editor of The Chinese State in Transition: Processes and Contests in Local China (Routledge, 2008) and Towards Responsible Government in East Asia: Trajectories, Intentions and Meanings (Routledge, forthcoming). Her articles have appeared in Political Studies, China Quarterly, China Journal, The Pacific Review and others. Her article in Political Studies (1997) was awarded the Harrison Prize as the best paper published that year. She is now working on a project on inter-governmental jurisdiction zoning.

Notes

^a These refer to staff costs for those not in active deployment, including pension payments for retirees and staff not assigned positions.

1. Two recently published studies on peasants’ needs are Liu (2006) and Yuan et al. (2006). The situation is not much better in more democratic political systems, however, as noted by Chhibber and Sisson (2004) writing on India.

2. Unless otherwise stated, information in this paper comes from author's interviews in Hubei during 2003–07.

3. See full text of budget at http://news.xinhuanet.com/misc/2006-03/17/content_4313792.htm, accessed 10 July 2006; and ‘2008 government report,’ accessed at http://www.xinhuanet.com/20081h/gzbg/20080305.htm, 8 March 2008.

4. Hubei Province, whilst also home to traditional heavy industries including iron and steel and automobiles, is one of the agricultural ‘heartlands’ of China (like Hunan to its south and Sichuan in the south-west) and has shared similar problems including heavy peasant burdens.

5. Xian-an District was Xianning City (county level) until 1999, when it was renamed Xian-an and made a district of the new and enlarged Xianning City (prefecture level). It has a population of 570,000, of which 77 percent are rural (accessed at: http://www.xajw.com/Article/ShowArticle.asp?ArticleID = 318, 15 July 2006). The ‘district’ in the Chinese hierarchy of governments occupies a near-equivalent ranking as the county. The only difference is that a district government is considered part of an urban municipality so that the municipal government often exercises more coordinating functions.

6. This account is based on the pilot reform experience in Henggouqiao Town, Xian-an District (author's interviews; Song 2006; and ‘Xian-an government report on the reform experience,’ accessed at http://www.xaxx.gov.cn/vallagechange/exprienceone.htm, 10 July 2006).

7. Jianli County is infamous for its high peasant burden and violent clashes between village and township cadres and peasants during tax-fee collection. Li Changping's famous book on the plight of peasants (Li 2002) is based on his observations as township party secretary in Jianli County.

8. A county official and formerly township party secretary admitted to the author in 2007 that most opinion gathering exercises conducted in townships were at best loosely executed.

9. ‘Temporary regulation on fund management of rural public services in Xian-an District,’ March 2006, accessed at http://www.hbcz.gov.cn/421202/lm3/lm340/2006-12-01-14443.shtml, 12 June 2007.

10. Song was reportedly the first senior cadre from Hubei to resign from the government to work as a ‘private individual’ in south China, when he left the government for Shenzhen/Guangzhou in 1988, after two years in the Provincial Policy Research Office. After a few years in the south he returned to Wuhan to study and earned a doctorate in history in 1993. From 1993 to 1998 Song went to Hainan and participated in the ‘Yangpu’ project there. He rejoined the government ranks during a recruitment drive by the Hubei government in 1998, and was Party Secretary of Xian-an District from August 1999 to late 2003 (accessed at http://www.nanfangdaily.com.cn/rwzk/20040630/sz/200408030039.asp, 11 July 2006, and http://www.phoenixtv.com.cn/home/phoenixweekly/145/20page.html, 25 July 2006).

11. Hubei Provincial Government Document No. 17 (2003), 4 November 2003, ‘Advice on implementing comprehensive township government reforms,’ promulgated provincial-wide reforms of township government and service agencies along the line of reforms in Xian-an. From January 2004, Song became vice-director of the Research Office at the Provincial Party Committee and vice-director of the Leading Group of the Hubei Township comprehensive reform.

12. Hubei Daily, 26 March 2004, accessed at http://www.chinarural.org/old/readnews.asp?newsid=%7B70BA71C6-3718-45E3-AF33-8D5B780D40A1%7D, 10 July 2006.