Audit reveals overspending at state-owned enterprises
Print Edition
SPENDING on golf courses, luxury cars, shopping cards and overly expensive materials was uncovered in an audit covering 11 state-owned enterprises, China’s top auditor said yesterday.
A total of 3.29 billion yuan (US$530 million) was retrieved after the National Audit Office investigated the companies last year, and 190 people have been punished for policy breaches or mismanagement.
The companies investigated included the China National Petroleum Corporation, China Resources, China Tobacco, China Aerospace Science and Technology Corp and China Nuclear Engineering Group.
“The audit survey has covered industries of strategic importance, which involve a huge amount of state assets,” the office said. “It is about guaranteeing China’s healthy economic growth, accelerating reforms, tracing potential risks and fighting against corruption.”
Overall, the office said, the companies had their core competitiveness enhanced with better quality of growth and faster accumulation of wealth. But there were “some problems worthy of attention.”
For example, some investment projects, including those of CNPC and China Resources, did not go through proper procedures, and irregularities were found in financial management and internal regulation.
In one case, some affiliates under the CNPC did not conduct an open bidding process for projects involving 26 billion yuan.
In addition, affiliates of China Resources purchased more vehicles than permitted and their prices went far beyond stipulated limits, the office said.
Other irregularities included hefty spending on the construction of golf courses, exaggerating material costs and buying shopping cards for employees.
“The 11 companies have attached high attention to the problems discovered and have made improvements to strengthen administrative management ... people related have been put under investigation,” the office said.
Earlier this week, the office said mismanagement at China Investment Corp, the nation’s US$575 billion sovereign wealth fund manager, was to blame for huge investment losses during the past five years.
The office also announced details of 35 cases involving bribery, embezzlement and other disciplinary charges handled in the first five months of this year.
China’s new leadership launched a campaign to combat corruption and also vowed to accelerate reforms in state-owned enterprises.
The country has thousands of state-owned enterprises with 113 directly administered by the central government. As they are the backbone of the economy, their monopoly in many areas, unchecked spending and corruption have long been cause for complaint from the public.
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