Special bond issuance strives for quality and efficiency

Our reporter Li Hualin

　　Recently, Minister of Finance Liu Kun stated in his report on the central government's final accounts for 2020 that local government special bonds should be used in 2021, guiding local governments to strengthen project reserves, appropriately relaxing the time limit for special bond issuance, reasonably controlling the pace of issuance, and increasing bond funds. Use performance.

Experts believe that this means that the pace of the issuance of special bonds will remain relatively stable this year, with greater emphasis on the effectiveness of issuance and use, emphasis on project quality management and risk prevention and control, and better use of the role of special bonds in promoting the economy.

The release rhythm is more stable

　　Approved by the National People’s Congress, this year’s budget has arranged a new local government debt limit of 4.470 billion yuan, of which the special debt limit is 3.650 billion yuan, which is slightly lower than in 2020, but still maintains a relatively large scale.

Previously, due to this year's advance approval of special bonds was issued slightly later than in previous years, the pace of issuance slowed down significantly in the first quarter. Therefore, the market expects that there will be a small peak of special bond issuance in April and May.

　　Judging from the reality, the peak did not arrive as scheduled.

According to data from the Government Debt Research and Evaluation Center of the Ministry of Finance, in the first five months, local government bonds have issued 935.1 billion yuan in new local government bonds, completing 21.91% of the issued debt limit.

Among them, new general bonds have been issued 362.5 billion yuan, completing 45.31% of the issued debt limit; new special bonds have been issued 572.6 billion yuan, completing 16.51% of the issued debt limit, which is significantly lower than the level of the same period in the previous two years.

　　The analysis believes that the main reason for the slowdown in the issuance of special bonds is that there is little pressure to stabilize growth in the first half of the year.

In the first quarter, my country's national economy showed a trend of stabilization and improvement, and it was in a window period with less pressure for steady growth.

"The economy has continued to recover since this year, and the need for fiscal counter-cyclical force is not high, and fiscal policy resources can be moved back to better smooth the economic fluctuations during the year." Assistant Director, Chief Macro Analyst of Huachuang Securities Research Institute Teacher Zhang Yu said.

　　Bai Jingming, former vice president and researcher of the Chinese Academy of Fiscal Sciences, stated that bond funds should be allocated, issued and used according to the progress of project implementation. This year’s special bonds will give priority to supporting projects under construction. In the first half of the year, there will be little pressure for new local projects. The progress of the project adjusts the pace of issuance, in line with the principle of "funds follow the project".

　　This year, the Ministry of Finance has also strengthened the management of special bonds and conducted penetrating supervision on the use of special bonds, which objectively slowed the issuance of special bonds.

“Local governments have turned cautious in the application and issuance of special bond projects. New projects are no longer'seeking big and fast', but are turning to infrastructure and public service projects with real demand and reliable amounts. Therefore, the issuance of special bonds has slowed down. In the first half of the year, the marginal improvement of the fiscal balance of local governments in the first half of the year was obvious. There was not much demand for the issuance of special bonds. The local governments made more follow-up government investment plan adjustments, such as the establishment of project reserve pools." Government Performance of the Chinese Academy of Fiscal Sciences Research center director and researcher Wang Zecai said.

　　Issuance quota is more accurate

　　As an important source of funds for infrastructure construction, special bonds are an important focus for making up for shortcomings, stabilizing growth, and benefiting the people's livelihood. The pace of its issuance has attracted much attention from the market.

　　Some people believe that this year there is a possibility that the quota cannot be issued according to the budget arrangement.

If the economic performance in the second half of the year continues to exceed expectations, the financial department may not be able to issue all the special debt quotas during the year in consideration of balancing fiscal revenues and expenditures.

　　"Special bond issuance is conducted in accordance with market-oriented principles, and there is no explicit stipulation on the lower limit of issuance. In theory, localities can not issue the new special bond limit for the year, but this is unlikely." Bai Jingming said, local special bonds throughout the year The quota is generally applied by the local government to the Ministry of Finance in advance according to the financing needs of the project, and the Ministry of Finance will allocate and distribute it after a comprehensive assessment. It belongs to “application on demand” and “distribution on demand”. , But if there are no special circumstances, the full-year quota will generally not be given up."

　　In addition, although the national economy started well in the first quarter, the current economic recovery is uneven and the foundation is not stable. The role of special debt to support the economy cannot be ignored.

Many experts said that with the relaxation of the issuance window period, the overall pace of the issuance of special bonds during the year will become more gradual. The pattern of issuance in the past few months may be difficult to reproduce, and the special bond issuance cycle may continue until the end of the year.

　　"Preliminary special bond issuance has slowed down, along with the release of quotas and the release of project financing needs, it is expected to accelerate in June and the third quarter to maintain the necessary support for economic recovery." Bai Jingming said.

　　Wang Zecai also believes that with the continuous improvement of subsequent local government project reserves and the gradual maturity of related projects, the pace of special bond issuance will accelerate, which fully reflects the quality and efficiency of fiscal policy.

　　Project management pays more attention to quality

　　This year, the Ministry of Finance pays more attention to the actual effect of the issuance and use of special bonds, and has repeatedly asked for project reserves to improve the performance of the use of special bond funds to prevent rushing to the top of the quantity and not the quality.

　　"Project quality is an important consideration for the Ministry of Finance to grasp the pace of special bond issuance at this stage." Bai Jingming said that local government special bond projects emphasize the need to have a certain income, and project financing must be balanced with income. However, some local special bonds are currently being reissued. The situation of neglecting management and re-establishing projects and negating income.

　　"my country's special bond issuance management mechanism is still in a new stage, and it is not perfect in terms of project reserves. In the past, special bond issuances have been large in scale, large in batches, and tight time. There have even been fictitious projects and misappropriation of bonds. Funding and other behaviors.” Wang Zecai believes that strengthening project reserves means improving the project review mechanism and preparing for the identification of high-quality special bond projects in advance.

　　The Ministry of Finance recently revealed that it will study and introduce local government special bond project fund performance management measures, strengthen special bond project performance management, further improve information disclosure, and earnestly bring out the use of special bond funds.

Bai Jingming believes that improving the use of special bond funds requires efforts from many aspects: to reduce costs, bond funds are different from general fiscal funds, and their use is paid, and more attention needs to be paid to costs and financing necessity; to ensure revenue, project selection We should focus on actual results and insist on matching debt and solvency; we should also strengthen project evaluation, move forward with supervision, and focus on reviewing whether the project’s expected return is balanced and whether it meets the financial affordability.

　　"We must adhere to the principle of'funds follow the project', elements follow the project, and "performance follow the project' principle, engage in pre-evaluation, in-process monitoring, and post-evaluation to establish an all-round closed-loop management chain to ensure that each bond fund is issued, Use it well, but still use it." Wang Zecai believes that the public channels for project performance evaluation information should also be expanded to give full play to the external supervision and binding force of third parties and social institutions.

　　Our reporter Li Hualin