Charity in fresh scandal over warehouse use
Print Edition
THE Red Cross Society of China is facing a new scandal after being found to have leased a central government-funded warehouse in Beijing that was designed to store emergency relief supplies.
Built at a cost of 117 million yuan (US$19 million), the facility was completed in October 2010. Soon after, the RCSC agreed to lease it to Beijing Zhongxun Yuhua Business Management Co, which then divided up the space and rented it out to various logistics companies, including DHL, according to a report at news portal www.qq.com.
The RCSC was paid 900,000 yuan a year, while Zhongxun Yuhua is alleged to have made several million yuan a year from subletting the warehouse, the report said.
Zhao Baige, the charity’s executive vice president, has admitted to leasing the warehouse, saying the money was used to pay employees’ wages.
“I don’t want to compare the RCSC to a young girl from a good family who is forced to sell sex, but we are facing problems,” she was quoted as saying.
“The funding that we get from the state covers only two-thirds of our expenses, but we’re not allowed to engage in business activities, so we can’t afford to pay our workers,” she said.
“The warehouse is too big for what we need right now, but it’s a waste to leave it empty, so what are we supposed to do?” she said.
As a result of the website report, all of the companies currently occupying the warehouse, which is located in the town of Niulanshan, have been told to move out by August 31, Zhao said.
An unnamed local resident said that everyone in the area knew the warehouse wasn’t being used for emergency supplies.
“It’s always operated as a logistics center. And it’s a waste of the nation’s money,” he said.
Workers from Beijing Tongyi Logistics Co were seen waiting outside the warehouse recently, while a DHL van was seen driving up to it, the report said.
According to an unnamed source quoted by the website, RCSC initially agreed to rent the warehouse to Zhongxun Yuhua, but fearing a scandal instead offered to “lend” it to the company at no cost, but in return for an annual donation of 900,000 yuan.
The going rate for renting such a facility would be about 5 million yuan a year, the source said.
Zhongxun Yuhua sublet the units for a combined 4.5 million yuan a year, and in doing so banked a profit of about 3.6 million yuan, the person said.
The company, whose legal representative is Wei Zhonghua and supervisor Kan Qian, was established on March 30, 2012, the report said.
As part of a “cooperation contract” signed with the RCSC, the company was appointed to help build a system for transporting emergency relief supplies. However, it is neither licensed for storing nor moving such items, it said.
Furthermore, the company’s registered address was found to be false, the report said.
According to the central government, the warehouse was specifically intended for the storage of disaster-relief supplies and should not have been sublet.
“I know that it should be up to the Ministry of Finance to decide what happens to the building, but we don’t get enough financial support, and we have a lot of employees to pay,” Zhao was quoted.
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