China News Service:

Fiscal revenue and expenditure this year have attracted wide attention. Can you provide a brief analysis? How will funding for key areas, such as ensuring people's livelihoods, be affected this year? Thank you.

Liu Kun:

You raised a question of public concern. To speak on fiscal revenue and expenditure this year, considering all factors, I believe that we can expect the economy's overall recovery this year, and fiscal revenue is mainly affected by two factors. One is that the recovery of the economy will lead to an increase in fiscal revenue. The other is that because we launched VAT credits refunds on a large-scale last year, the base is relatively low correspondingly. The joint influence of these two factors will lay a foundation for a rebound in fiscal revenue. However, we must also note that the foundation for achieving China's economic recovery needs to be further consolidated, and fiscal revenue faces major uncertainties. In terms of fiscal expenditure, expenditures in key areas, including research and development in science and technology, rural revitalization, and eco-environmental protection, will increase undoubtedly. Greater support is needed to shore up weak links in elderly care, education, healthcare and other areas that are important to people's lives. Government spending is directed to support the coordinated development of regions and support local governments in their efforts to ensure payment of salaries, normal operations, and people's basic well-being; sufficient funding is required to provide transfer payments.

Although notable budgetary imbalances still exist in 2023, we will not cut our spending on basic living needs. We will do everything within our capacity to ensure continued increases in spending to meet basic living needs, make every effort to bring tangible benefits to the people, and ensure a more complete and lasting sense of fulfillment, happiness, and security for our people.

First, we will fully implement the employment-first strategy. We will make full use of the central government's employment subsidies to support reducing burdens, stabilizing jobs and increasing employment. We will facilitate the employment of young people, especially college graduates. We will support rural migrant workers, people lifted out of poverty, ex-service members and other key groups in finding jobs and starting businesses. We will continue to support vocational skills training to tackle structural unemployment.

Second, we will give priority to ensuring the development of education. Based on the 21 trillion yuan of government spending on education in the past five years, we have continued to improve the mechanism for government spending on education. For many years, government spending on education has remained above 4% of GDP. Just now, I mentioned that the share of tax revenue in GDP has decreased. Tax revenue is a major source of fiscal revenue. The share of fiscal revenue in GDP has been decreasing. Meanwhile, the share of spending on education in GDP should be kept basically stable. Therefore, that means the share of government spending on education in fiscal expenditure has increased over the past few years. We will enhance weak links in compulsory education, increase resources for public-interest preschool education via multiple channels, and support the improvement of regular high schools' basic conditions.

Third, we will enhance medical and health services. We will support the COVID-19 response in a new phase and improve the funding mechanism for basic medical insurance. We will deepen the reform of public hospitals to ensure that they genuinely serve the public interest and advance the unified management of basic medical insurance funds at the provincial level.

Fourth, we will improve social security. We will fully implement unified national management of basic old-age insurance funds for enterprise employees and take active steps to promote the development of private pensions. We will improve supporting measures to boost birth rates as well as fiscal policies and measures in response to the aging population. We will support people in buying their first homes and improving their housing situation. I remember that at a press conference held here before, a reporter asked about efforts to guarantee basic old-age insurance for enterprise employees. My answer was that all enterprise employees in China would be ensured of the insurance. Now, basic old-age insurance funds are guaranteed in the way that I mentioned then.

Fifth, we will continue to improve the ecological environment. We will speed up the efforts to launch projects for the holistic conservation and restoration of mountains, waters, forests, farmlands, grasslands, and deserts. We will support the actions to keep our skies blue, waters clear, and lands clean and facilitate the transition of major industries and sectors towards green and low-carbon development. Thank you.