Research On Legal System For Supervision Of Government-investment In PPP Mode

The reform of the investment and financing system in China is vigorously operated now which started from the establishment of macroscopic framework to the institutional implementations step by step.PPP(Public-Private-Partnership)mode,which contains the idea of public-private cooperation,is the crux of promoting the transformation and upgrading of economic and the key of transformation government function which has been explored since1990 s.Judging from the whole,PPP mode,which is a new method of government investment,means that establishing a cooperative partnership with shared risks and benefits by government and social capital’s joint taking charge of the construction of public goods and services that should have been the responsibility of government and this is also known as public-private partnership mode.Based on the theory of public goods and principal-agent theory,the legitimacy of government investment has been proved.Based on the benefit principle of the market economy and economic law,the PPP mode has been vigorously promoted due to the ever-increasing gap between the need for infrastructure facilities and the availability of public budgets.However,each coin has its two sides and the PPP mode is also no exception with an amount of problems emerging such as the misuse of investment funds in PPP projects and the approval acquisition of PPP project through illegal measures.After the practice of more than 40 years,in spite of the much attention of Chinese government on the regulation of the PPP mode of government investment,there are still many problems which may not only restrict the initial advantage of supervision on government investment but also increase the risk of corruption and lead to a more serious situation of the local government’s debt problem due to some complex reasons.Therefore,it is particularly important to build a faultless legal system of supervision on government investment under the operation of the PPP mode.Government investment is the lifeblood of the national economy,and the public interest is closely related to the government investment in PPP mode.Through the sorting out of the status quo of PPP legislation and the analysis of classic cases of PPP in China,the legal system of the supervision on government investment under the operation of PPP model in China mainly has the following problems: first of all,chaos exists in legal system,which means that there are conflicts between regulations and normative documents of various departments and there is a lack of guidance from the upper level law.Secondly,the authority of the supervision department is unclear,and multiple supervision results in low efficiency of supervision.Thirdly,the capital supervision in the PPP mode is insufficient,the benefit distribution mechanism is also not perfect;Fourthly,there is no post-evaluation and accountability mechanism;Lastly,the absence of social supervision and the single supervision mode is another question.There are five suggestions in terms of the existence of above issues.Firstly,we shall accelerate the process of specialized legislation on PPP and perfect the legal system for PPP supervision.Secondly,a specialized agency should be set up to supervise and manage PPP.And then,the supervision department should make clear the importance of investment budget estimate and strengthen the supervision of investment funds;Fourthly,the government needs to establish a post-evaluation mechanism for PPP projects and strengthen in-process and ex-post supervision;At last,we should strengthen external supervision and create a multi-dimensional regulatory approach.PPP mode,as a new type of government investment and financing model,was developed under the background of deepening the reform of investment and financing system and accelerating the construction of the socialist market economy system.The successful application of PPP mode can meet the infrastructure needs of urbanization and lower the risks of local government’s being in debt.At the same time,it is also necessary to let social capital participate more in the provision of public services so as to reduce the direct allocation of resources by the government as well as transform government functions and promote the spirit of contract.To promote the development of the PPP mode,it is necessary to have a solid supervision and legal system as support which is the crucial to avoid the problems of project implementation difficulties and non-standard investment and get out of the dilemma of "stressing electronic" but " belittling operation " and "low efficiency instead of high efficiency" of government investment under this model.