Research On Operation Mechanism Of Budget Stabilization Found In China

Budget Stabilization Fund (BSF) is also known as the Rainy day fund, it’s created for counter cyclical recession according to the Counter cyclical regulation theory. BSF has the function of budget adjustment and financial reserves. Since 1946 the New York State first established budget stabilization fund, it has been proved to balance the budget, stabilize economic fluctuations, and respond to emergencies efficiently, after years of practice. China’s BSF was introduced for its special background that China’s fiscal surplus revenue issue. Since 2007 the central budget stabilization fund is established, China’s Budget Stabilization Fund system has been in operation for almost seven years and has achieved some success in the actual operation. With relevant content appears in the revised budget law, budget stabilization fund is expected to become a long-term system of public budget management. But there are also some shortcomings in the process of running the fund and the operating mechanism on the Fund’s lack of detailed analysis. How to achieve our budget stabilization fund in the standardization and institutionalization are still many issues to be studied, especially to clarify the direction of the operating mechanism of budget stabilization fund.This article combines the relevant literature at home and abroad in recent years and searches government domestic budget stabilization fund documents issued. With the data from financial budget in the recent years, this paper analyzes the background and significance of budget stabilization fund and then it researches BSF’s income, using way and supervision operating mechanism. At last it makes recommendations to improve China’s BSF’s Operation mechanism by learning from foreign experience.This article believed that excess revenue ran through BSF’s several years of operating practice in revenue, using ways and supervision mechanism. China’s BSF has been a main role in the governance of financial excess revenue. BSF plays a role in regulating the budget, but fiscal reserve fund is less functional expression. This paper presents China’s BSF needs to have the financial reserves of the function, the Fund should take the fiscal reserves oriented into consideration.