Revisions to China’s budget law, passed on 31 August 2014, represent a significant reform, providing a framework for significantly greater transparency and accountability for local government says Fitch Ratings. Fitch expects that these changes will eventually improve the quality of budget management. The moves will also facilitate efforts by central government to align local authorities’ objectives more directly with public service provision. The new budget framework includes requirements to establish multi-year rolling budget plans and placing local revenues and expenditures under the supervision of local peoples’
congresses.
Questions:
1 Identify three significant advantages of rolling budgets.
2 Identify three problems that are likely to be encountered when using rolling budgets.