The “tight times” are really coming? Many civil servants and teachers are backtracking on bonuses already paid

Civil servants and teachers at institutions in Henan, Jiangxi and Guangdong, China, have recently received recoveries from the authorities for bonuses paid and performance awards withdrawn. In some cases, they have been paid 20,000 RMB per person for the first quarter, and have announced that they will stop paying bonuses in the future. Grassroots civil servants and school teachers are crying out in anguish, lamenting that the “hard times” are really here.

Government administrative spending is getting tighter and tighter across China. The authorities have repeatedly asked local governments to “live a tighter life”. On July 7, just after the Communist Party’s July 1 centennial celebration, the Water Resources Bureau of Nanchang City, Jiangxi Province, issued a document stating that, according to the relevant regulations, all government awards issued after June 7, 2021, should be refunded unconditionally within ten days. For its part, the Dexing City government required all teachers to return the original high-quality bonuses issued on the 7th to their school bank cards in a uniform manner. The performance bonus for teachers in Dexing City is reportedly 20,000 yuan for the first quarter and 80,000 yuan for four quarters, with an additional year-end bonus. These rewards are higher than teachers’ total annual salaries.

Li Qiao, a scholar from Jingdezhen, Jiangxi province, said in an interview with Radio Free Asia this Monday (12) regarding the government’s recovery of bonuses from civil servants and school teachers, that all signs point to a problem with the state’s finances.

“No matter how much the authorities advertise the bumper grain harvest and how much economic growth there is, we can see stores closing down everywhere, businesses closing down and some people losing their jobs. Plus the epidemic continues until now. The country’s tax revenue is bound to decrease. It is inevitable that she is now in financial difficulties, and it is real that bonuses and other benefits are being cut.”

Recovery of paid bonuses is not a single event enforced by local governments

Weibo netizen chat shows that Shanghai, Jiangxi, Henan, Shandong, Chongqing, Hubei and Guangdong have all seen civil service bonuses stopped and ordered to be returned in full. In Chaozhou City, Guangdong Province, as early as July 3, a unit received a notice to stop paying housing allowance and performance. Three days later, Shanwei City followed suit. In Shenzhen, some units are counting employees’ income in recent years. Shanghai has also stopped paying first quarter bonuses.

In response to the sudden recovery of bonuses for grassroots civil servants, Tan Zuoren, a Chengdu-based Internet writer, told the station that he had received relevant information. He said.

“There are about seven, eight or ten provinces where performance bonuses for civil servants have been cancelled or even backtracked, and those already paid out have to be returned. The direct reason for this move is that the government is financially strained. There are various reasons for the financial strain, one is that since the epidemic last year, the fiscal revenue will definitely decrease. At the same time expenses have increased, causing an imbalance between revenues and expenditures.”

Currently, most grassroots civil servants, primary and secondary school teachers earn anywhere from $2,000 to $4,000 a month, and most of their child support and mortgage repayment expenses come from various subsidies and performance bonuses. In this way, many people have problems with their family income and expenses. There are notices on the Internet that some units require employees who cannot get money to take out bank loans. For example, Jiujiang Bank in Jiangxi Province launched a “refund loan” to provide loans for employees who can’t get money.

Last year’s fiscal deficit surged this year to live a tight life

China’s fiscal deficit surged by 30% in the first half of last year, and local debt surged by 3.4 trillion yuan. Officials reported that the general public budget revenues and expenditures of 31 provinces and cities, only Shanghai has a fiscal surplus, the remaining 30 provinces and cities have the problem of revenue not covering expenses, the most stressed provinces such as Henan, Sichuan and Yunnan, the shortfall of revenue and expenditures are more than 250 billion yuan.

Scholar Li Qiao said that this year’s civil servants were cancelled various incentives, highlighting the seriousness of the problem:.

“In the first half of last year, only Shanghai’s finances were slightly flat, the rest are fiscal deficits, the government will not easily cut (civil servants’ bonuses), in addition, now they say all day long to live a tight life, to live a hard life and so on? these words are there for a reason.”

Local governments are living a tight life central officials have not followed

In May last year, Chinese Premier Li Keqiang proposed in the “Government Work Report” that governments at all levels must truly live a tight life, with the central government taking the lead and negative growth in central-level spending arrangements, with non-urgent and non-rigid spending being reduced by more than 50 percent.

However, no official announcement has been made that the central government is taking the lead, but this time it is the ordinary civil servants and teachers who are taking the lead in “living a tight life”.