Senior managers of some state-owned enterprises in Guangdong are criticised by a government-backed research centre as receiving unreasonably high salaries and arbitrary bonuses, according to media reports.
Citing the China Business News, the South China Morning Post reported that the Guangdong Provincial Conditions Survey and Research Centre recently released a wide-ranging report, which said the managers were "using dubious methods to divide up their companies profits".
The China Business News report quoted Jiang Leyi, secretary-general of the provincial Communist Party Discipline Inspection Commission who wrote one section of the report, as saying some SOE leaders give themselves high salaries based on inflated assessments of their contributions. She added that some leaders had earned up to 100 million yuan over several years even though their organisations were losing money. "Some state-owned enterprises arbitrarily distribute the profits in the name of bonuses and divvy up the SOE property," she said.
The report of the Guangdong Provincial Conditions Survey and Research Centre also said "the existing salary management system in Guangdong lacks standards and effective restraints, and is out of control overall." It said many SOEs in Guangdong had no salary management rules and wages were rising at a much higher rate than profits at some enterprises. According to Guangdong State-owned Assets Supervision and Administration Commission, the average labour costs at Guangdong's 21 state-owned enterprises rose by 11 per cent in the first half of last year, while profits had dropped by an average 6.5 per cent.
Sources: China Business News, South China Morning Post (24 August 2006)
24 August 2006