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Ministry of Railways to be abolished under Chinese reform plan

11 Mar 2013

CHINA: Proposals to abolish the Ministry of Railways and split its functions between the Ministry of Transport and a new railway operating body are included in a report on institutional reform of the State Council which was unveiled on March 10.

The reform of the cabinet aims to clarify responsibilities and reduce bureaucracy, with the total number of ministries to be cut from 27 to 25.

Under the proposals outlined by State Council member Ma Kai, a railway administration within the Ministry of Transport would be responsible for 'administrative functions', including supervising service quality and construction projects, as well as the setting and monitoring of technical and safety standards.

A separate China Railways Corp would be responsible for 'commercial functions' including passenger and freight train operation and construction projects. According to Minister of Railways Sheng Guangzu, this corporation would be able to take a more market-oriented approach to the provision of services.

It is hoped that the enlarged Ministry of Transport would able to take a more integrated view of rail, road, air and water transport, while separating activities into different bodies would reduce opportunities for corruption.

The large debts incurred by the Ministry of Railways during the rapid expansion of the railway network in recent years would be allocated to the supervisory and operating bodies as appropriate.

Sheng emphasised that the reform was not expected to impact of future railway investment, which is projected at 2·3tr yuan in 2011-15