124 6 Financing Compulsory Education in Rural Areas: The Development ...
6.2.3 The “County Centered Management System”
2001–2005
In order to guarantee the funding for rural compulsory education and promote
rural educational development, it was felt that the “Township Centered” fiscal sys-
tem must be changed. In 2001 the State Council established the management sys-
tem for rural compulsory education which was “Under the leadership of the State
Council, locally responsible, with divided responsibilities that were county-cen-
tered”. It symbolized once again a significant major reform in the fiscal and man-
agement of compulsory education in China.
In 2001, the State Council issued the “Decision on Reform and Development
of Basic Education” requiring the system to “Improve the management system,
guarantee financial investment and promote the sustainable and healthy develop-
ment of rural compulsory education”. In particular, it clarified the responsibilities
of different levels. First, the central government had the decision-making power
to decide on the teaching system, the courses offered, the curriculum standards
and the approval of textbooks. Central and provincial government increased edu-
cational investment in compulsory education in poor and remote areas through
transfer payments. Second, provincial and prefecture level governments had to
strengthen educational planning, organizing and coordination, guaranteeing the
demands of rural compulsory education when arranging the transferring pay-
ments. Third, government at the county level was given the main responsibility
for local rural compulsory education, planning for primary and secondary school
development, readjustment of the distribution of schools and construction and
management, pedagogy and teacher deployment, and payroll operations. Local
governments at township level were left with operational responsibilities for run-
ning schools and were allowed to raise education funds, improve school conditions
and teachers’ conditions, maintain public security and safety of the school, and
ensure enrolment of all school-age children.
In May 2002, the General Office of the State Council released the “Notification
on the improvement of the rural compulsory education management system”.
This emphasized the need to establish safeguard mechanisms to guarantee the
flow of investment and made a series of provisions. First, local governments at
various levels were invited to “meet the basic requirements and develop steadily”,
and adjust the fiscal structure to ensure wages were paid to teachers in a timely
and sufficiently manner. Secondly counties were given the norms and standards
for funding rural elementary and middle schools to ensure a more even flow of
resources. Third, mandatory systems of inspection for inspecting and identifying
inadequate school buildings and renovating dilapidated schools were introduced.
Fourth, the New Mechanism was used to guarantee a more regular flow of funds
with the intention of increasing the amounts available to support rural school
development. Fifth, new regulations regularized the management of funds and
assets for education with greater transparency and accountability. They required
that disbursement should be on time and adequate, and that funds were not to be