Master, I’ve been studying fiscal policies recently and noticed that the government’s work report once again emphasized 'austerity measures,' calling for cuts in administrative expenses to allocate more funds to public welfare. What do you think about this?

'Austerity measures' are not a new concept but an inevitable choice in fiscal management. You see, in recent years, tax revenue growth has slowed, land transfer income has declined, and government fiscal pressure has increased, making it necessary to optimize resource allocation.

That’s true. Data shows that in 2024, national tax revenue decreased by 3.4% year-on-year, and provinces are adjusting their budgets. But some worry that reducing administrative expenses might affect government efficiency.

It depends on how the reductions are made. If they focus on cutting 'three public expenses'—such as receptions, travel, and government vehicles—while trimming unnecessary meetings and trips instead of reducing essential public services, it could actually improve administrative efficiency and minimize resource waste.

Then why is there still controversy over 'austerity measures'? Some argue that they could strain local finances and even impact social governance.

That is precisely the challenge of policy implementation. A 'tight budget' for local governments should not equate to 'inaction.' The key is to cut non-essential expenses while ensuring the quality of public services, such as optimizing budget structures and introducing market-based financing.

I see. So the core of 'austerity measures' is not just about cutting costs but also about using fiscal resources more efficiently, right?

Exactly. The wisdom of governance lies not in mere 'tightening' but in precise allocation, ensuring that limited funds generate maximum benefits. The art of governance is all about balance.