On October 14, China Daily reprinted an article first published in Beijing Youth Daily about the abuse of R&D funds. On October 11, China’s State Council of Information Office held a press conference at which Wan Gang, China’s Science and Technology Minister, stated that the “dreadful problems” with research and development funding were shocking.
The three year audit of the ministries under the State Council and the provinces revealed that out of several hundred audit reports that were done from 2007 to 2012, 39 involved “problem R&D funds.” The 39 audit reports showed that fraudulent practices could pass the approval processes, that programs could be developed without feasibility studies, that funds could be allocated even when there was no possibility of implementation, and that the completion of projects could be accepted without any inspection.
For example, the 13 institutions of higher education under the Shandong Province Education Department spent 943 million yuan (US$154.61 million) on R&D when they had no projects. From 2010 to 2012 the Transportation Ministry spent 186 million yuan (US$30.5 million) of 1,556 million (US$255.12 million) in R&D funds on salaries and subsidies to personnel, without complying with personnel regulations and pay standards.
In recent years, China’s R&D expenditures have grown about 20 percent annually. In 2012, they accounted for 1.9 percent of GDP, reaching 1.024 billion yuan (US$167.89 billion)
Source: Beijing Youth Daily reprinted by China Daily, October 14, 2013