The Research On Local Government Debt Management In China Under The Background Of The New "Budget Law"

The new "budget law" comes into force in January 1,2015, It not only means the budget management system of China become deeper, but also provides the legal basis to solve the problem of local government debt management. Judging from the present condition, the new "budget law" has played a certain effect in solving the problem of local government debt management after more than 1 years of implementation. But the problem of local government debt management is a historical issues, Although the Chinese government promulgated the new "budget law", the debt problem is still one after another. So the Chinese government should focus on the local debt management under the background of the new "budget law".Local government debt management problems began in the 90’s of last century. Because of the old "budget law" which enacted in 1994, local government bonds were forbidden, in order to develop the local economy, governments at all levels have used other means to raise a loan. Currently, the total size of Chinese local government debt reached 24 trillion yuan, increased by 34%, reflected a number of characteristics just like the large scale and the fast growth rate, Although the total amount of debt is basically controllable, some local areas have the serious debt risk already, Therefore, if the long-term accumulation of local government debt crisis if not resolved, it will become the negative factor which could affect the economic and social development of China.Based on the background of the new "budget law", combined with the relevant research results at home and abroad, this paper is based on the budget constraint theory, the debt risk management theory and the fully-covered budget management theory, after the combinated of the new "budget law",this paper provides some new requirements of local government debt on size, management, use, income and expenditure, and the supporting system, analyzes problems about the size of the debt, contingent liabilities, the local financing platform and the debt regulatory, through the analysis,this paper draws a conclusion that the disunity of local government’s financial authority and power, the imperfect of legal and administrative supervision, and backward management mode are the three reasons which cause local government debt problems, puts forward a series of suggestions and measures to improve the management of local government debt in China. At last,this paper aims to strengthen the current local government debt management, ensure the formal specification of local debt payments, let the using method scientifically, make the risk controlablely in the management area, let in the process of reviewing and supervising transparently, achieve clear responsibilities accountablely, And then promote Chinese economic and social development steadily and healthily.