Study On Reform Of The Current Financial Supervision Authority Of Local Government

The financial supervision authority (FSA) of local government is an important part ofthe financial regulatory system in our country and one of the important functions and powersby the local government under the conditions of the market economy. Nowadays, theallocation imbalances between the (FSA) of the central government and local government,however, strengthen local government (FSA) exist various objective requirements. Thisarticle mainly from the theoretical and practical basis, realistic demand and the facts on thebasis of three aspects this paper expounds the necessity of local government exercise thepower of FSA, We conclude the imbalance of FSA between central government and localgovernment is the base of reform of FSA. This imbalance forces the demand to reform. Wefound out the global trend of FSA is to strengthen the supervision. The benefit of strengthenlocal government’s FSA includes the advantage of geography, advantage of information forfinancial innovation and fix the financial system problem, and the advantage to protectconsumer’s right. In addition, the local government exercises the power of financialregulation, there is real demand both in domestic and abroad, foreign countries also havesimilar practices, we conclude it is reasonable to reform FSA. It helps to balance the problemof right and duty. It also fits to improve the institution under competence.The article concerns about the current situation of financial supervision of localgovernment. We analyze the history of local financial supervision and conclude the problemand conflict of FSA. We find out the serious imbalance of FSA. Local government should getmore FSA. We found out the origin of problem is the relationship among value consciousness,institution structure and benefit mechanism.Finally, we suggest for how to improve FSA of local government. The resolution shouldbe based on legal structure building of FSA, the set-up of destination of financial supervision,division of right of FSA and the cooperation mechanism. We consider that it is necessary todeal with the relation between central government and local government by the legal eyesight,make clear the principles of FSA under the constitution. Local government should own theright to execute the financial supervision authority in its administrative area. On valueconsciousness, local government should get a balance between safety and efficiency. Oncooperation mechanism, it is necessary to build a normal cooperation institution forcommunication between central and local government. Under the separated structure of FSA,local government should design for the mechanism about division of authority andcooperation mechanism. The goal is to build a scientific, reasonable and efficient institution.