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Announcement by the National Audit Office of the People’s Republic of China (CNAO) on Audit Findings of Relief Funds And Materials provided for the We
2009-04-13日   Soure : :

Announcement by the National Audit Office of the People’s Republic of China (CNAO) on Audit Findings of Relief Funds And Materials provided for the Wenchuan Earthquake (No.4)

                                             December 31, 2008

After the major earthquake hit Wen C huan, Sichuan Province, under the firm leadership of the Central Committee of the Chinese Communist Party and the State Council, Party committees and governments of all levels united people of different ethnic people as one and led them in performing timely relief work, relocating victims of the disaster, doing whatever they could to rescue and give emergency treatment to the wounded and restoring production in the earthquake areas with the spirit of “when one place is in difficulty, helps comes from all sides and giving priority to people. Significant victory was scored in the earthquake relief work. From May 14 to the end of November, 2008, audit institutions of all levels throughout the country conducted auditing of 18 departments and units of the central government, 1,289 departments and units of 31 provinces (autonomous regions and municipalities), Xinjiang Production and Construction Corps, 5,384 departments and units of regional level and 24,618 departments and units of county level. Extended auditing was done to 3,845 towns, 9,526 villages and 76,709 earthquake-stricken households were investigated in Sichuan Province, Gansu Province, Shanxi Province, Chongqing municipality and Yunnan Province. During the process of auditing the materials and funds for earthquake relief work, the Audit Administration already presented three public notices regarding successive audits. Now according to the stipulations of the Law of Audit of the People’s Republic of China and requirements of the Public Notice Regarding Strengthening the Supervision and Management of Materials and Funds for Earthquake Relief Work jointly issued by the Commission for Inspecting Discipline of the Central Committee of CCP, Ministry of Supervision, Ministry of Civil Affairs, Ministry of Finance and National Audit Office, the audit findings are made known to the public as follows:

  1. Basic facts about collection, use and storing of funds and materials for earthquake relief work

(1) Basic facts about relief funds appropriated by the central and local governments

(a) Up to the end of November, 2008, the central and local governments altogether appropriated 128.736 billion RMB as funds for earthquake relief work. The central government appropriated 38.242 billion RMB (of which 26.496 billion RMB was arranged as special subsidiary fund and 10.93 billion RMB was jointly arranged through Ministry of Communications, Ministry of Public Health and other relevant units, and the rest was used for allocating and transferring of grain to the earthquake areas, market supply in those areas and education in disaster relief work); 65.171 billion RMB was for reconstruction in earthquake-stricken areas.

31 provinces (autonomous regions and municipalities under direct jurisdiction of the central government) and Xinjiang Production and Construction Corps appropriated 25.323 billion RMB as disaster relief work fund.

(b). 5 earthquake-stricken provinces and municipality,namely Sichuan, Gansu, Shanxi, Chongqing and Yunnan,received 116.648 billion RMB from the central government and governments of various levels and already spent 48.017 billion RMB, of which expenditure of comprehensive financial subsidiary 2.041 billion RMB, 7.97 billion RMB for urgent repairing of infrastructure, 4.963 billion RMB for public security, education and radio stations and TV stations while 3.801 billion RMB goes to other expenditures.

(2) Basic facts about social donation of materials and funds

18 departments and entities of the central level, 31 provinces (autonomous regions and municipalities) and Xinjiang Production and Construction Corps received materials and funds of a total of 64.091 billion RMB, of which, 18 entities of the central government received directly funds and donations in kind of a total of 12.781 billion RMB, 31 provinces (autonomous regions and municipalities) and Xinjiang Production and Construction Corps received directly funds and donations in kind of a total of 51.31 billion RMB; the expenditures amounted to 23.176 billion RMB, mainly for relief of civil affairs, material reserve, allocating and transferring of materials, urgent repairing of infrastructure; cash on hand and inventory for post-disaster reconstruction amounted to 40.915 billion RMB (of which the fund amounted to 40.236 billion RMB and materials were worth 0.679 billion RMB. )

Among social organizations and various foundations that accepted donations, Red Cross Society of China and Red Cross Foundation received 4.69 billion RMB and spent 1.997 billion RMB. The balance was 2.693 billion RMB; Charity Society of China received 0.92 billion RMB and spent 0.837 billion RMB, the balance was 0.083 billion RMB; the Association for Relations Across the Taiwan Straits received 0.673 billion RMB and spent the same amount (including the amount transferred to the Ministry of Civil Affairs); All-China Federation of Trade Unions received 0.326 billion RMB and spent the same amount (including the amount transferred to the Ministry of Civil Affairs); the Central Committee of Communist Youth League of China received 0.056 billion RMB and spent the same amount (including the amount transferred to the Ministry of Civil Affairs); Song Qingling Fund of China received 0.042 billion RMB and spent 0.042 billion RMB. The balance amounted to 0.027 billion RMB; China Foundation of Helping the Poor received 0.195 billion RMB and spent 0.051 billion RMB and spent 0.051billion RMB. The balance was 0.144 billion RMB.;China Education Development Foundation received 0.172 billion RMB and spent 0.152 billion RMB. The balance was 0.07 billion RMB;China Foundation for Cause of Helping the Poor received 0.189 billion RMB and spent 0.152 billion. The balance was 0.037 billion RMB; China Women’s Development Foundation received 0.026 billion RMB and spent 0.006 billion RMB. The balance was 0.02 billion RMB;China Children and Teenagers’ Fund received 0.134 billion RMB and spent 0.034 billion RMB. The balance was 0.1billion RMB;China Youth Development Foundation received 0.231 billion RMB and spent 0.064 billion RMB; the balance was 0.167 billion RMB; China Guanghua Foundation received 0.015 billion RMB and spent 0.01 billion RMB; the balance was 0.005 billion RMB.

Up to the end of November, 2008, 89 units and individuals whose donations over 100 thousand RMB had not been in place. These promised donations amounted to 0.278 billion RMB. They failed to come for various reasons: donations are to be delivered in installments according to the donation agreement; the items of donation had not been finalized; some donating parties ran into difficulty of fund turnover; some committing parties and individuals were nowhere to be found.

  (3) Basic facts about “special party dues”

Altogether 45,597,000 Party members paid 9.73 billion RMB as “special Party dues”, of which 9.189 billion RMB of a special account (not including interest) was remitted to the Organization Department of the Central Committee of CCP and 0.541 billion RMB was left in Sichuan, Shanxi and Gansu. The Organization Department already appropriated 1.2 billion RMB to the earthquake hit areas. The rest (not including interest) was transferred to the Ministry of Civil Affairs in accordance with the management regulations for the spending of the funds jointly drawn up by the Organization Department, State Development and Reform Commission, Ministry of Civil Affairs and Ministry of Finance and would be used to support the relief work and reconstruction of the five earthquake-stricken provinces and Chongqing municipality.

2. Evaluation of the audit

Ministry of Civil Affairs and Ministry of Finance and other relevant departments in charge of funds and materials for the disaster relief work came up with a series of regulations and management rules for strengthening management of funds and materials for the earthquake relief work and for enhancing management levels and utilization efficiency of the funds and materials in accordance with the need of the relief work and the demand of the central government and the State Council that all relief funds and materials shall be used in the earthquake areas and for the earthquake-stricken people in time and that the people shall be reassured clear about where the money and things have gone. While Party organizations and governments of all levels actively implemented policies for disaster relief work by organizing urgent rescues, relocating earthquake-affected people and restoring agricultural and industrial production, they further improved and defined approaches of management of relief funds and materials according to the actual circumstances in the earthquake-stricken areas. They worked hard to realize openness and transparency of allocation and use of funds and materials, spared no efforts in enhancing the availability factor of them; main institutions that accepted donations, such as Red Cross Society, Charity Society, performed very strict management of donations by setting up internal restriction system to ensure timely raising of funds and collection of materials, safe management and effective utilization of funds and materials; departments of supervision and inspection committed themselves in time and coordinated closely, thus forming a combined effort. By timely inspection and penalizing they corrected cases of various kinds in violation of laws and disciplines and standards so that problems were prevented or further developed, thus ensuring the implementation of various policies and measures formulated by the central government.  

The audit findings show that basically, the funds and materials were raised and collected legally and in an orderly way. Allocation of them was no later than scheduled. Distribution of them was open and transparent. Management of them was strict and standardized. Utilization of them was in compliance with regulations and effective. Storage of the materials was safe. Accounts for relief funds of various kinds were comparatively clear. No case of serious violation of laws had been found in the audit so far.

Up to the end of November, 2008, there were 1,962 tip-offs, of which 176 cases were found with clear clues. 168 cases were reviewed by audit institutions and 8 cases were handled by local governments. The 168 reviewed cases by audit institutions were concluded. Cases in violation of rules and regulations that turned out to be true were already disposed of by audit institutions and departments concerned according to laws and disciplines.

3. Basic facts about main problems discovered in auditing and corresponding rectification

During the auditing process audit institutions of all levels conducted audits according to the requirements of achieving standardization while performing audits. Putting forward suggestions and urging rectification once whatever problem was discovered. They came up with more than 3,640 suggestions in relation to strictly implementing various national policies of disaster relief work, fortifying receipt, distribution, utilization and management of funds and materials, uplifting availability factor of relief funds and materials and avoidance of loss and waste. Great attention was paid to the suggestions put forward by audit institutions. As a result, 2,940 suggestions were accepted. Based on the audit opinions, more than 570 stipulations and systems were drawn up, thus ensuring the scientific, reasonable and effective utilization of relief funds and materials. For instance, in order to solve overstocking of relief materials in 6 gravely-stricken cities and prefectures, a problem reflected in the audit finding, the headquarters of earthquake relief work of Sichuan Province formulated the Opinion for Disposing Surplus Medicines and Medical Apparatuses and Instruments for Earthquake Relief Work; according to the suggestion offered by the audit body; Han Yuan County corrected its erroneous practice that people in some of the villages and towns had to dismantle their dangerous dwellings before they became entitled to receive temporary help as “people having no dwellings, no means of production and no income” .

(1) The public notice made before August 4 reflected the rectification in the use and management of relief funds and materials.

In the No. 2 public notice regarding the auditing of the funds and materials for the Wen Chuan earthquake relief work issued by the the National Audit Office on June 24 disclosed the management of the relief funds and materials arranged by financial departments were not standard enough, the policy not complete enough and the execution of policies not thorough enough. Relevant local governments attached great importance to the notice. They began to formulate, perfect and standardize policies and stipulations with a serious attitude toward rectification. Relevant departments worked hard to figure out solutions, draw up and improve policies and regulations, fortified the supervision and management of donations in cash and in kind and standardized the management of relief funds and materials to usher in rectification in raising,  collecting, managing and distribution of funds and materials to ensure the implementation of all policies.

The No. 3 public notice issued on August 4 by National Audit Office regarding the audit of funds and materials for Wen Chuan earthquake relief work reflected the fact that donations in cash and in kind as well were staying idle in certain governmental departments and units, and in some places there was overstocking, and materials were not appropriate for the relief work. Some places and some units took advantage of the opportunity to charge whoever received subsidiaries and raised qualifications for subsidiary. Construction of prefabricated houses in some place failed to meet the actual need. Relevant local authorities and departments wasted no time in presenting management systems and methods to strengthen the improvement of utilization, allocation of funds and materials and disposal of inappropriate and overstocked materials, prohibit the practice of charging and arbitrarily lifting the qualifications for subsidiary, and adjust the construction plan for prefabricated houses, thus uplifting the availability factor of relief funds and materials and avoiding waste.

  (2) Problems discovered after August 4 during the audit and their rectification

During the audit from August 4 to the end of October, the following problems were found related to management and utilization of disaster relief funds and materials in some area and some unit:

(a)  Report from some place submitted to higher authorities was inaccurate. 

As after the earthquake transportation and communications became inconvenient, it was next to impossible to conduct field survey to check disaster data and situation. As some areas and units made an estimation based on part of the losses caused by the earthquake and their deviated understanding or incorrect understanding of corresponding policies and demands, the losses and the number of victims reported during the few days after the earthquake hit were inaccurate. Take the Tourism Bureau and Communications Bureau of Chongzhou, Sichuan Province, for example. They each submitted a report listing the earthquake-stricken 47-kilometer highway leading to Nine Dragon Ravine and Cockscomb Mountain as their loss in tourism and communications, thus repeating the data pooling and a repeated loss of 1.234 billion RMB was listed. The report from the city of Tianshui showed that the number of “people having no dwellings, no means of production and no income” was greater than the total number of people affected in the counties and villages pooled together. Hence, inaccurate number was irrevocable. After the audit finding pointed out the problems, the government of Chongzhou spared no efforts in re-checking the loss and correcting their mistake and the government of Tianshui conducted a new assessment in strict accordance with stipulated process and deducted 71,419 people as “having no dwellings, no means of production and no income”.

2. Some areas failed to allocate and utilize relief funds in time.

(a) The relief funds failed to be appropriated in time. For instance, the Department of Finance of Sichuan Province did not appropriate the 20 million RMB arranged by the Ministry of Finance to relevant units for evaluation of survey of secondary geological disaster. As a consequence, the provincial Bureau of Geology and Mining Industry and other units that participated in the survey would have to advance their own funds to start it. After the audit body pointed it out, the provincial Bureau of Finance appropriated the above-mentioned fund to relevant units on September 5.

(b) The relief money was not issued in time. Up to the end of September, the Department of Finance of Shanxi Province appropriated to cities and counties an amount of 0.46 billion RMB as relief fund. The cities and counties witheld 40.25% of it, i.e. 44.76 million RMB. The city of Ankang received 0.4476 billion RMB, but it withheld 0.4403.28 billion RMB. The Government of Shanxi Province attached great importance to this problem, instructing
all cities and counties to conduct rectification and implement thoroughly the relief policy. Up to October 20, 82.06% of the relief money had been handed out. As high as 83.46 % was achieved in the city of Ankang.

(3) The issuance of condolence money to dependents of earthquake victims was slow. Up to September 20, Mao County of Sichuan Province had not issued condolence money to the dependants of 3,862 earthquake victims. After the audit body pointed it out, Mao County quickened its steps in the issuance after checking the number of victims.

(4) The scope of expenditure and the standards were not explicit, thus causing the overstocking of a large amount of fund. The Bureau of Finance of Aba Prefecture, Sichuan Province, appropriated in May and June respectively a toal of 12.59 million RMB of earthquake relief fund, but up to September 17, it was still kept at the county Bureau of Finance. The Construction Bureau of the city of Pengzhou received in June and July respectively a total of 4.9 million RMB as emergency relief fund. Up to August 4 it had remained unused. After the audit body pointed it out, relevant areas and units began to use the fund in accordance with regulations.

3. Some unit’s management of disaster relief materials was not standardized.

(a) Some relief materials was excluded from statistics. Take cell phones cards for example. The relief work headquarters and municipal Bureau of Public Security of the city of Pengzhou, Sichuan Province, received cell phones cards worth 302 million RMB. But up to August 20, there were no statistics record of the receipt, issuance and disposal of the cell phone cards left. No public notice was given and no report was submitted to higher authorities. After the audit body pointed it out, the cell phone cards were included in the statistics dated on October 21.

(b) Part of the received materials did not pass through the accounts for examination and calculation. As the assets ownership was not clear and there were no invoices and for some other reasons, up to August 16, the 320 units /sets of X-ray machines, monitoring apparatuses and go-anywhere vehicles received by the People’s Hospital, Hospital of Chinese Traditional Medicine of the city of Pengzhou, Sichuan Province, and other 29 medical institutions did not pass through the accounts for examination and calculation. The 124 units of medical equipment, 260 vehicles, 78 units/sets of precision instruments received by the Bureau of Communications, the Bureau of Construction and the Bureau of Water Affairs of the city of Mianyang did not enter books. After the audit body pointed them out, the city of Pengzhou completed the entry of the fixed assets on August 31 while departments concerned in Mianyang conducted evaluation of relevant materials and performed the necessary process and formalities for books entry.  

4. Some units did not purchase relief materials according to needs and prices of some materials were a bit too high.

(a) There was no effective information exchange system between departments. It led to repeated purchasing of relief goods. Up to July 31, the public health system of Sichuan province had had already in store more than 1,700 tons of disinfectants, bactericidal agents and more than 7,800 sprayers, but on August 13 the Epidemic Prevention Station for Animals of Sichuan Province purchased 300 tons of disinfectants and bactericidal agents and 12,500 sprayers.

   (b) Prices were a bit too high. When the Medical Company of Sichuan Province, according to the Public Health Department of the provincial government, performed interim monopolized purchase of disinfectants and bactericidal agents produced by 8 enterprises within the province, it paid 20.44 million RMB simply based on their quotations. The sample auditing showed that the prices of the disinfectants and bactericidal agents which Chengdu Aotu Science and Technology Company supplied the Medical Company of Sichuan Province with were respectively 16% and 32% higher than those before the earthquake. As time was pressing, Tianjin Red Cross Society and the Department of Civil Affairs of Shanxi Province, without conducting any market survey and price inquiry, purchased respectively in May 45 and 100 illumination vehicles from Lantong Construction Machinery (Tianjin) Co., Ltd., the price of which was 40% higher than the average price of products of the same model during January to June, 2008.  

Relevant local governments attached great importance to the problems discovered in the auditing by establishing and improving the communication system between departments, presenting strict measures for purchasing, strengthening price regulating and instructing units concerned to lower their prices.

5. Some unit changed the usage of relief funds arbitrarily.

(a) Some unit changed arbitrarily the usage of relief funds. The Bureau of Public Health of Mao County of Sichuan Province by listing the donated 20.2 thousand RMB under the item of expenditure for meeting holding spent it in awarding advanced individuals and collectives emerging from the disaster relief work. After the audit body pointed it out, the Bureau offset the award with its office allowance.

(b) The Provincial Committee of Communist Youth League of Gansu Province appropriated the donation of 860 thousand RMB it received to grass-root units as work allowance. In accordance with the audit opinion, the Provincial Committee already issued a notice with the instruction that all the money should be used in reconstructing youth volunteer service in the earthquake areas.

(c) The Communications Charge Collecting Section of the city of Longnan, Gansu Province, used the special subsidiary appropriation of disaster relief fund to award employees or as subsidiaries issued to employees or as allowance for heatstroke prevention. The amount was 40.96 thousand RMB. That Section has already corrected its expenditure not in compliance with stipulations. 

6. There was a large overstocking of donated money from the employees within some industries.

Up to the end of August, the Power Company of Sichuan Province, Chengdu Railway Bureau and other 5 units in Sichuan under the leadership of the central government were still holding 26.4043 million RMB donated by their employees for the victims in the earthquake areas and for those within their industries. After the audit body pointed it out, those units began to make arrangements for using the donated money according to stipulations.

As for some people who had violated laws or disciplines, relevant local Party committees, governments and department took quick measures to investigate and affix responsibilities of people concerned. The suspected offenders against laws were handed over to judicial institutions. The audit institutions handed over 146 cases which involved 162 people to institutions of discipline inspection, supervision and judiciary; relevant persons responsible for offenses were penalized in accordance with Party disciplines and administrative disciplines respectively or were prosecuted according to laws.

Now the all-round follow-up of the auditing of funds and materials for earthquake relief work organized by the Audit Administration has smoothly come to an end. It will conduct a follow-up audit of reconstruction next. The Audit Administration will focus on the collection, allocation, management and use of the funds and materials for the reconstruction, implementation of policies and plans for reconstruction and quality of reconstruction in accordance with the Opinion of Audit Administration on Arrangement of Audit of Post-Earthquake Reconstruction approved by the State Council. In the meanwhile, the demand of “whoever performs the audit shall issue a public notice” will be realized with the Audit Administration and local audit institutions at a proper time make known to the public the auditing of post-earthquake reconstruction respectively.