The allocation of new quota selects the objective factors that affect the scale of government debt, and according to the debt risk and financial situation of each region, the expenditure of major projects determined by the central government and the local financing demand are considered as a whole, and the factor method is used to calculate. The data of objective factors come from statistical yearbook, local financial budget and final accounts and information provided by relevant departments.
The allocation of new quotas should reflect the principle of positive incentives, with more arrangements in areas with strong financial strength, large debt space, low debt risk and good debt management performance, and less or no arrangements in areas with weak financial strength, small debt space, high debt risk and poor debt management performance.
In order to prevent local government debt risks, avoid excessive debt growth and abnormal fluctuations, and ensure the stable operation of local finance during the year, the fluctuation coefficient range is determined based on the average growth rate of new quotas approved by the National People's Congress, that is, the highest growth rate of new quotas in each region does not exceed the upper limit of the fluctuation coefficient range, and the lowest is not lower than the lower limit of the fluctuation coefficient range.
Dr. Tang from the Financial Audit Research Office of the Institute of Finance and Economics of China Academy of Social Sciences told reporters that this notice is the first time that the Ministry of Finance has standardized the allocation and management of the new limit of local debt. To strengthen local debt management, it is necessary to properly handle existing debts and standardize the management of new debts. "It is necessary to manage both the old and the new, and together form a complete local debt management structure."
In recent years, through various efforts such as screening and replacement, the management effect of China's local debt stock is obvious, and related risks have been effectively resolved. Tang said that this stage is a good opportunity for China's local debt management to enter the stage of paying equal attention to both stock and increment from the previous stage of focusing on stock, and further strengthen and standardize local debt management. It is foreseeable that new local debt management measures may be introduced in the future.