Study On Financial Treasury Single Account System Reform

Traditional treasury receipt and payment system functions through many multi-accounts set by tax bureau and budgetary units. The system is of various disadvantages, such as the decentralization and multi-set of accounts make it possible for treasury funds to be used in"black case"and large amount of off-budget funds are out of the control of fiscal administration, thus form a kind of unit-owned exchequer in which the money could be used at the units'discretion. Overdue in receipt of treasury funds cause the fiscal revenue suffers great loses. The feedback of treasury receipt and payment information is so slow that it is difficult to provide immediate reference frame for budget-making, implementation and macroeconomic control. The whole process of using treasury funds is lack of all-round effective supervision in advance, among the course and afterwards, which is easy to cause corruption. Fiscal sections at different levels transfer treasury funds in terms of sections, units and administrative budget. Different departments in fiscal bureau transfer different categories of outlays and the functions of the departments in fiscal bureau are divided in terms of the category of funds or sections'difference. This mode of funds allocation cannot achieve the goal of concentrate all treasury funds on big projects and weakens the supervision and control of the funds transferred in budgetary units.Judging from above information, there is an urgent need to establish"Treasury Single Account"(TSA) system. TSA system is that treasury funds receipt and expenditure is implemented only by one account, which is managed only by fiscal sections. Fiscal sections, with authorization and in accordance with law, collect all fiscal revenues in national treasury. In permitted budgetary projects and within amount line, units can order goods and services by themselves, but the payments are made directly to goods and service suppliers by national treasury.Building TSA system is an important reform of China's national treasury management. Under the condition of the market economy, there are various disadvantages of our traditional national treasury system of scattered management, which is out of step with the public finance. Since the year of 2001, reforms had been taken from central to local finance departments. The reform has got some effects, but at the same time met with lots of problems in practice. Focusing on the problems and referring to the developed western countries'experience in the TSA system, this paper tries to find a suitable way of the TSA system, which fits the fundamental realities and the actual state of the country, standardizing TSA system management, perfect relative supporting measures.Referring to a large number of documents and my own experience, I research deeply how the country goes on with the reform of the TSA system.1, Analyzing economic theories relating to China's national treasury management such as public finance theory, public choice theory, theory of agent and system innovation theory, illustrate the theoretical basis of our country's national treasury management.2, The history and status quo of the development of TSA both home and abroad. First, introducing the development of national treasury account system in OECD countries. Taking France as an example, introduce the framework and management of its national TSA, the setup and settlement of treasury account, the relation between central bank and government in treasury transactions and the supervision system. Summarize the common characteristics of western country's TSA and learn from overseas advanced experiences. Though there are many differences in OECD countries'national treasury institution's framework and responsibilities, the basic management system including TSA system, national treasury receipt and payment process and treasury's supervision system. The characteristics of OECD countries'TSA system includes the efficiency and transparency of treasury funds usage, the singleness and centralization of TSA functioning mechanism, the duty and controllability of supervision, the importance of national treasury funds'management by central bank.Second, starting with analyzing the characteristics and disadvantages of traditional national treasury management system. The characteristics and disadvantages of scattered receipt includes multi-receipt-account causes the difficulty of treasury funds, the usage of transitional account is easy to cause fraudulent practices in treasury funds collection, the slow inflow of treasury funds causes the deficiency of funds using, the informal collection of treasury funds made by tax bureau causes receipt is not in full amount. The characteristics and disadvantages of scattered payment includes treasury funds transferring procedure is too complex to realize immediate collection, serious"rent-seeking"problem lead to unfair funds allocation, unstandardized government budget plan causes chaos of funds allocation, the unclear transfer of funds lead to slow feedback of expenditure information, budgetary units abusing treasury funds causes ineffectiveness of supervision in advance, scattered payments make it difficult to make a clear distinction between treasury funds and credit funds and thus go against the implementation of national monetary policy, scattered payments cannot reflect the real amount of fiscal expenditure and fiscal sections are unable to make prompt and correct judgments on current financial and economic situation. Last, introducing current situation of our country's TSA system reform pilot programme. By taking the city of Yi Wu and Shi Chuan province as examples, introduce the reform progress at city level and at provincial level, summarize the overall problems met with during the pilot programme, and point out the gap between the requirements of"The national treasury management system pilot programme"and the reality.3, Measures for our country's TSA system reform. For solving the problems occurred during the pilot programme, in terms of the requirements of"The national treasury management system pilot programme", research on countermeasures, bring forward the reform's basic principles and the standardizing suggestions on account management, and 6 supportive measures including boost budget drafting procedure reform, rectify and consummate relevant laws and regulations, realize transverse unite network among fiscal bureau, tax bureau, treasury and commercial bank, improve inter-bank clearing and settlement system, carry out government procurement system in an all round way, improve treasury supervisory function.4, Taking Liao Ning province as case, study the beneficial result of the reform and further illustrate that standardizing TSA management has met the requirements of our country's current TSA system reform.Conclusion: Implementing treasury management reform which is based on TSA in an all round way is a necessary choice of establishing China's public finance. Improving standardization and unity of China's TSA system reform is of great importance. The supportive measures for the reform still need to be strengthened.