Ijcrb.Webs.Com 25 EVALUATING the NEW SUPPLY MECHANISM of VILLAGE PUBLIC GOODS in CHENGDU AREA BASED on GOVERNANCE VIEW

ijcrb.webs.com MAY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 4, NO 1

EVALUATING THE NEW SUPPLY MECHANISM OF VILLAGE PUBLIC GOODS IN CHENGDU AREA BASED ON GOVERNANCE VIEW

Wu Ping Associate professor, College of Economics and Management, Sichuan Agricultural University, Chengdu , Sichuan, China (611130) Zhang Qian Master, College of Economics and Management, Sichuan Agricultural University, Chengdu , Sichuan, China (611130)

Abstract Improving the supply mechanisms of public goods in village level and providing adequate and reasonable public goods in rural areas are the necessary conditions to narrow the gap between urban and rural areas and are also essential to balance urban and rural development and to promote development of rural economy and social stability. In this paper, basing on village governance view, setting up the corresponding indicator system and using fuzzy comprehensive evaluation method ,we evaluate the supply mechanism of public goods in village level of the representative villages(communities) in Chengdu’s three spheres areas to provide some proposals on perfection of the supply decision mechanism of public goods in village level , multi-channel fund-raising mechanism and so on. Keywords: Village Public Goods, Supply Mechanism, Fuzzy Comprehensive Evaluation Method Introduction The difference in supply of public goods between the city and countryside is a major barrier to narrow the gap between urban and rural areas and get well-off in rural areas. That difference not only directly affects the living standards and quality of life among rural residents, but also has a very negative impact on the improvement of rural productivity and sustainable development of the rural economy. Therefore, coordinating of urban and rural public goods supply and reducing the gap between rural and urban development are necessary to achieve the coordinated development between cities and the countryside. The coordination is also a main way to build up harmonious urban-rural relationship and an important task in the process of building a new Socialist countryside. Having become the national urban and rural comprehensive reform experimental zone in 2007, Chengdu will put Rural public services and social management into its public finance coverage and actively explore the new mechanism of the rural public goods supply.

1.Basic framework of the new village public goods supply mechanism in Chengdu

In July 2009, Chengdu Co-ordination Committee issued Interim Measures of Public services and public administration in Chengdu village special funds and Public services and management measures for the management of the village financing of construction project, clearly saying that an annual allocation of special funds to the reform for each village (community) should not be less than ￥200,000. Village self-government organizations can provide no more than seven times of the amount of funds as financing loans to Chengdu Small Town Investment Co. , Ltd.

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Co-ordination Committee of municipal and county governments

report Approve and allocate funds Product and

Chengdu Small Capitalflow ·· production Construct financing E Villagers Committees(Township xpression of demand Town Investment department ce government supervise and guide ) Co. , Ltd of public Call for tenders 乡镇政府监督指导） Get the loan abovefrom to below goods Decide Communicate ideas needed public

up fromup the bottom goods Villagers’ Council

Express requirements Collect opinions

Villagers

From the chart above we know that a series of mutual connection links consist of new village public goods supply mechanism and those links are closely related to each other, around echo and constitute an organic system. Villagers Committees are at a central position in the new mechanism and are in charge of collecting villagers' opinions to make strategic decisions of public demand projects and reporting those public demand projects to Co-ordination Committee of municipal and county governments. After those projects are approved, Villagers Committees can apply for a loan from Chengdu Small Town Investment Co. , Ltd and then call for tenders to build the projects. Municipal and county governments coordinate and arrange special funds and at the same time, they will supervise the supply situation of village public goods. Government platform company, Chengdu Small Town Investment Co. , Ltd provides low-interest loan to fund the projects building.

2.The characteristics of village public goods supply mechanism in Chengdu 2.1 Freshly establishing villager council to achieve real villagers' autonomy Villagers’ congress authorize the villagers’ council to implement the governance-discussing， decision- making and supervising authority while the village committee is the executing agency which is in charge of the villagers’ congress and the villagers’ council. The villagers’ council is responsible for extensively collecting the opinions and suggestions on the development of this community from the community residents, foreign long- stay nationals, and various economic and social organizations inside the community ,to make sure that everyone in the community has the right of speech to achieve real villagers' autonomy. In addition, The village council divides the power of the village party secretary and village party secretary , solving the long-standing problem of the supervision absence. 2.2.Guided by Villagers' demand to express the real requirement more easily "Measures" says the village public goods supply must be guided by villagers' demand. Only after we establish an effective mechanism for expression of villagers’ demand can a demand-driven rural public goods supply mechanism be really established. In practice of Chengdu，village organizations extensively collect the villagers opinions through the villagers’ congress and implement the，governance-discussing， decision-making and supervising authority through the villager council. The establishment of the villagers’ council , on the other hand , encourages the villagers to participate in the management of village affairs , making the expression of need smoother and more real .

2.3. Guarantee the funds in Chengdu by including the village public goods funds in the financial budgets The village special funds have been included in the budget to ensure long-term stable input solve the problem about sources of rural public goods funds. This means we can get financing within limits. Therefore, the sources of funds are more ensured and the burden of the villagers is reduced.

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3.The problems in the practice of the new village public goods supply mechanism 3.1.Whether the real villagers' views are effectively reflected First, the existence of interest groups will largely affect public decision making. Religious bodies in village are one of interest groups and they can form temporary unions to largely affect even determine the public decision making when voting on supply of public goods. Next, educational levels of villagers will also impact the effectiveness of demand expression. Last but not least, whether villagers’ council becomes a mere formality in practice should be considered.

3.2 The financing channels are relatively homogeneous The only financing channel is Chengdu Small Town Investment Co. , Ltd so that the financing channel is relatively homogeneous . The Small Town Investment Co. , Ltd regulates the types of financing public goods and the funds cannot be used for the building property ( including activity rooms, culture rooms and Squares) .

3.3 Whether the supervision mechanism can be effectively implemented

The villagers’ council is the main method of villagers’ supervision , but villager’s council itself has some disadvantages: first, such a monitoring mechanism is based on the morality which is unstable and this kind of instability will probably lead to the oversight of supervision ; secondly, staff of villagers’ council there may be assigned by the village organization and this situation may result in invalid supervision.

4. The evaluation of new rural public goods supply mechanism in Chengdu

This research randomly selects town and the village organizations of Chengdu three spheres1 areas and we use interview and questionnaire survey as investigation methods. We choose those places as investigation sites: Chengdu Small Town Investment Co. , Ltd, Chengdu Co-ordination Committee, Xingfu Village of Sansheng County in Jinjiang District, Baonian Village of Tianhui Town in Jinniu District, Nanqiao Village of Yongning Town in Wuhou District, Huali Community of Yongning Town in Wenjiang District ,Huimin Community of Gongping Town in Wenjiang District , Baimiao Village of Sanxi Town in Jintang District, Lugao Village in Qingbai river District ,Mayan Village of Youzha Town in Qionglai City and TangYing Communituy of Yangan Town in Qionglai City. Considering former qualitative analysis, we use the fuzzy comprehensive evaluation method to evaluate new rural public goods supply mechanism in Chengdu.

4.1 Evaluation Indicators setting According to the management theory, factors of weighing the pros and cons of public goods supply mechanism are mainly following:(1)Legality. It refers to the nature or state whether a decision to supply public goods can be consciously recognized, and there is no direct relationship between it and legal norms. Reflection on the supply of public goods are the common needs of different members of society, and the maximum public consensus and consent is necessary. (2) Accountability It refers to those to whom the supply of public goods is should take their duties and must perform the appropriate functions and obligations. (3) Response. It refers to that takers of public goods must respond timely and responsibly to the needs of the citizen, and can take the initiative to consult the public and answer questions.(4) Validity. It principally refers to effectiveness of the

11st sphere:Jinjiang District, Chenghua District, Jinniu District, Wuhou District, Qingyang District, Hi-tech District; 2nd sphere: Xindu County, Pi County, Wenjiang District, Shuangliu County, Longquanyi District, Qingbai River District; 3rd sphere: Dujiangyan City, Pengzhou City, Jintang County, Xinjing City, Chongzhou City, Dayi County, Pujiang County, Qionglai City.

ijcrb.webs.com MAY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 4, NO 1 decision-making and implementation of the supply of public goods，that is, to achieve high efficiency and low cost of the supply of public goods. (5) Participation.It refers to that the public can participate widely in decision making, execution and management and oversight of the public goods supply process, particularly at the village level it is necessary to improve the participation of the villagers to achieve real villagers Autonomy(6) Impartiality. It means that the citizens ,regardless of their gender, educational level, class, race, religion and 2 political beliefs of the are equal in the enjoyment of public goods or services.

Reference to the evaluation index system of rural public goods supply and empirical test of the design shown in table 1:

Table 1 The evaluation index system Targets Level 1indicators Level 2 indicators

A1：legality B1：rationality of Supply arrangement B2：Supply mechanism in accordance with the relevant laws A2：accountability B3：Rate of investment funds B4：Project qualification rate B5：Supply and demand status and adjustment B6：Quality management of public goods A3：response B7：Villagers ' satisfaction with the Government's handling of demand preference B8：Supply feedback level Comprehensive A4：validity B9：Ability to communicate with the villagers evaluation of the village B10：Decision-making efficiency public products supply B11：Supply mode choice system in Chengdu city B12：Financing efficiency B13：Financing alternatives B14：Effectiveness of supply incentives A5：participation B15： the awarness of expression B16：smooth degree in Views expression path B17：Awareness of democratic supervision A6：impartiality B18：impartiality of Village Council decision B19：Rural old-age insurance penetration B20：Rural health insurance penetration B21：Degree of universal compulsory education in rural areas

2YU Keping. Theory of global governance[J]. , Marxism & Reality2002(1).

ijcrb.webs.com MAY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 4, NO 1 4.2 Evaluation with fuzzy comprehensive evaluation method 4.2.1 Evaluation results According to the survey and statistics findings of every community, we use analytical hierarchy process to get weight coefficients and utilize centesimal system to quantize results of fuzzy comprehensive evaluation. Now we simplify operations 4343and show results of derivation directly. Table 2 Integrated scores table Name of index Comprehensive evaluation of quantitative value

Baonian Huali Lugao Baimiao Tangying community community village village community

A1 legitimacy 26.2946 25.5346 26.657 26.2946 26.2946

A2accountability 17.0689 16.7555 15.5885 16.5427 16.9339

A3response 7.5519 7.7871 6.8973 7.0635 6.7797

A4validity 12.3946 13.0682 12.2388 12.0504 11.9216

A5participation 7.5335 7.3677 6.4893 6.7921 6.4631

A6impartiality 20.6184 19.3066 18.0295 17.7314 19.7836 Total score 90.6271 91.1315 87.1775 86.7728 86.1243

Data source: based on calculated 4.2.2Result analysis From the aggregate analysis above，we can obtain the comprehensive scores of the five villages (communities). Therefore, we can get the following conclusions: First, on the whole, comprehensive score of Huali community of Yongning Town in Wenjiang District was the highest (91.1315), followed by the comprehensive score of Baonian community of Tianhui Town in Jinniu District (90.6271). We can see that the degree of perfection of the village public goods supply mechanism substantially decreases by three cycles. But there is a special case that the Huali Community of Yongning Town in Wenjiang District in the second sphere scores higher tha Baonian Village of Tianhui Town in Jinniu District in the first sphere. Since Yongning Town in Wenjiang District is a key town dorminated by six ministries of the state, also the Chengdu key town, and the international medical city. The development trend of Tianhui Town is fine and the town’s construction is quick with sufficient capital and advanced technology. Therefore, the town’s supply of village public goods is superior to the other areas and is in a leading level. Second, from the first-level indicators, in A1 legitimacy, Lugao Village in Qingbai river District gets the highest score. Legitimacy includes the rationality of main body’s institutional arrangement and whether supply mechanism is implemented according to relative laws. According to the survey analysis, this is probably because Lugao village is one of the first rural public service demonstration villages in Chengdu. Compared to those non-demonstration villages the villagers have stronger feelings of being benefited directly. Thus ,they are relatively satisfied with the system and will give higher evaluation. In A2 Accountability , Baonian Village of Tianhui Town in Jinniu District got the highest score. This means Baonian Village has high financial capital availability ratio, high eligibility of construction project and well supply and demand and adjustment situation of public goods. In A3 response, Huali Community of Yongning Town in Wenjiang District obtains the highest scores. The villagers’ degree of satisfaction with the government's handling of needs and preferences is higher and so is the degree of supply information feedback. In A4 validity, Huali Community of Yongning Town in Wenjiang District gets the highest score . Validity includes decision-making efficiency, financing efficiency and so on. In as much as Huali community has abundant funds, villagers’ satisfaction with the two aspects is high. In A5 participation, Baonian Village of Tianhui Town in Jinniu District receives the highest score . Since the village is in the outskirts of Chengdu , villagers’ cultural quality of the villagers is relatively higher and awareness of demand expression and supervision is stronger . In A6 fairness ，Baonian Village of Tianhui Town in Jinniu District gets the highest

ijcrb.webs.com MAY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 4, NO 1 score . Baonian Village is near the downtown of Chengdu so that medical insurance and endowment insurance are spread rapidly. At the same time, compulsory education in rural areas is almost entirely covered. 5.Conclusion and suggestion 5.1 Conclusion Village public goods supply mechanism in Chengdu City is quite reasonable, and the overall level is high. Village organization is a small community organization, and the extent of information asymmetry between villagers and village organizations is low. Villagers can rationally measure the village public benefits and costs. In a sense, the villagers’ participation in the public decision-making process is also a process of information communication between villagers and village organization. Thus the villagers have the information basis and motion in participating the public decision-making. On this basis, the establishment of a public expression mechanism is feasible and positive . village public goods supply mechanism in Chengdu is to promote democratic election, democratic decision-making , democratic management and democratic supervision of public choice mechanism , so that farmers can fully express their preferences for public goods , and truly reflects the villagers' autonomy .

5.2 Suggestions 5.2.1Optimizing policy environment of village public goods supply The key of improving the village public goods supply is to create a favorable legal system environment, which is also essential for China 's modern agricultural development . The reform of urban and rural household registration system is the precondition of realizing the fairness, justice and optimization in the village public goods supply.

5.2.2To improve the decision-making mechanism in village public goods supply On one hand, the demand expression mechanism in village public goods should be improved. We should guide the villagers to actively participate in the decision - making activities and the management and supervision of public affairs , and continuously improve the cultural quality of the villagers to cultivate civic consciousness ，master consciousness and the awareness of democracy and the rule. On the other hand， the democratic decision-making mechanism should be improved . Building the democratic decision-making mechanism is necessary to guarantee the village public goods supply. 5.2.3Achieving the diversification of subjects and financing channels village public goods supply Because of differences in demand and supply, it is important to choose different subjects on different links and supply public goods in different ways. With the economic and social development and scientific and technological progress, a large amount of quasi-public goods which are close to private products appear such as telecommunications, network, individuation agricultural information services and so on. We can adopt marketing approaches as supply and financing channels of those village-level public products to realize diversification of supply. 5.2.4Strengthen financial supervision of the village public goods supply In the process of village public goods supply, it is necessary to make village affairs and government affairs public and inform the villagers of the use of village public goods funds to make the use of village public goods funds transparently. The methodology of village public goods project management should be reformed .The rational use of village public goods funds can be guaranteed and public goods investment returns can be promoted with the help of introduction and popularization of the tendering , the project budget , centralized payment , government purchase, the evaluation system for experts or intermediaries , financial management system and life-long responsibility system of project . The supervisory role of social audit should be strengthened and unlawful practice and illegal activities must be timely investigated and punished . Evaluation system and assessment mechanism should be established and at the same time, social supervision mechanism should be actively introduced.

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