SHANGHAI, June 12 China's government-owned firms
will transfer parks, transport infrastructure and other "social
functions" to local authorities by the end of this year,
regulators said on Monday, part of the country's ongoing efforts
to slim down the state sector.
The State-Owned Assets Supervision and Administration
Commission (SASAC) said in a notice state-owned enterprises
(SOEs) must transfer functions that "do not match the main
direction of their business development" to local authorities.
The country's heavily indebted state-owned firms, most of
which have been carved out of state bureaus, have been under
pressure to ditch schools, hospitals, retirement homes,
firefighting services and other "social functions" in order to
cut costs and focus on their core businesses.
The assets, which also include water supply and household
sewage treatment infrastructure, as well as environmental and
public health facilities, will be transferred to the government
free of charge, the SASAC notice said.
From 2018, no state firm will be obliged to cover the costs
of "social functions" that have already been transferred to
local governments, it added.
China's state firms were obliged to provide lifelong
employment and cradle-to-grave social welfare as part of its
"iron rice bowl" system.
But with thousands of companies tottering on the brink of
bankruptcy in the 1990s, the government promised it would
implement reforms in order to reduce their burden.
The process has been complicated, however, with
under-resourced local governments unable to afford to renovate
run-down SOE-owned infrastructure or cover the health care,
education and pensions of thousands of retired workers and their
families, especially in "one-company towns" where the SOE was
the major source of income.
(Reporting by David Stanway; Editing by Jacqueline Wong)