The Research Of The Town Government Procurement Of Minhang District

Government procurement is the cornerstone of the framework of thepublic finance system which the government establishes under the marketeconomy condition. It’s also an important policy instrument to improve themanagement of public expenditure. As one of the important part of the publicexpenditure system, government procurement system is the significant meansto realize financial innovation in China as well as the necessary requirement toaccommodate to the special agreement rules of WTO.Few people can understand the meanings of government procurement tenyears ago in China. Not until the promulgation of Government ProcurementLaw in Jan.1st,2003government procurement raised its status distinctly. Tillnow, our government procurement management has almost10years’experience and has forms the management pattern with framework of central,municipal, district and town level. However, the study of governmentprocurement begins in the late1990’s in China and most of the theories arereferred by the experiences abroad. The studies focus on the scale, method, meaning and laws and the results can be classified into two typesapproximately, which are pragmatism and patternalism, only few resultcombines both of them.Town government procurement management means the grass-root unit,whose procurement scale and scope reaches the requirement of centralizedpurchase, founds the central purchase organization to manage theadministrative agency-procurement of the projects, goods and services. As thegrass-root unit, the town government is the bottom of the finance managementsystem. Whether the government procurement system can be implementedeffectively is the key point by which it can be consummated.This paper briefly discuss the basic concept, principal and mode ofgovernment procurement and its’ difference from personal purchase. Therelated theoretic including the principal-agent theory, the equilibrium pricetheory and the performance theory will be analyzed in this paper. We mainlyanalyze the issues in town government procurement through the study of thedetails of the government procurement management in Minhang District, andthen suggest taking comprehensive measures with both external and internalfactors to improve the management performance. And we also discuss how toestablish the linkage system with district and town level and the pattern oftown government procurement. Then the corresponding suggestions will bemade to improve its’ management.The implement of the government procurement at the town level is the important part of the public finance innovation at the district level. It is thenecessity requirement of deepen the innovation of the fiscal and taxationsystems as well as the key point to carry out the slogan which is ‘the townfinance shall be managed by the district and all the procurement shall bemanaged all together’. Therefore, study on the town government procurementmanagement can help to optimize its system and to improve the usage of thefund in order to give the direction to ensure the effective management of towngovernment procurement.