Research, Build A New Budget Management Mechanism

This article is composed of four parts, in which, the first part expatiates the general situation and great significance of public budget management; the second part gives an analysis and reference of the western budget management; according to the problems existing in our current budget management systems, the third part discusses the general framework of the reform and the main contents of the new operation system; finally, in the fourth part, relevant measures and policy suggestions are outlined.During more than fifty years since the establishment of our country, there have been many reforms to the public budget management, amongst which, the most important and effective one is the tax system and the divided tax system innovation in 1994. It established the basic framework of budget management system that is more suitable for the development of the socialist market economy. However, comparing with the international standard budget management system, there's still a great gap between ours and those of the western countries. On one side, there isn't a proper and stable mechanism of the revenue increase, and the expenditure scope of the public finance is not so appropriate. On the other side, the functions of the budget management haven't been adjusted accordingly, which lead to the lag behind of the patterns and methods of the budget management. It's also not so powerful and efficient. Owing to the above mentioned problems, the budget management reform is now very important to the promotion of the financial reform.Budget management plays a critical role in the whole Public Finance management. How the patterns and policies of budget management fit the market economy, will to a great extent, affect the establishment andoperation of the new public finance management system. It will also further influence the development of the socialist market economy. Following the principle of legal, scientific and canonical, the design of the new budget management system realizes a separation of the creation and the implementation of the budget, which in turn enforces the budget creation function, contributing to the development of a scientific and canonical budget creation, and in the mean time, strengthening the financial supervision function to the budget creation. As a basic form of budget management, section budget puts a lot of emphasis on its foundation effects, which comes to be the center of the operation of financial fund ,and leads to a new operation system of its use, management and supervision. This new system will accelerate a lot to the efficiency of the allocation of public resources and the benefits gaining from the financial fund. The adoption of those new creation methods like factor-basic budget and comprehensive budget are more aware of the objective factors instead of artificial factors. It will greatly improve the transparency of the allocation of financial fund, resulting in a more scientific budget management. In brief, as an important part of the financial management system matching the socialist market economy, the new budget management mode will have an active impact on the consummation of our socialist market economy system.