The State Council issued a plan on June 22 to reduce the burden on State-owned enterprises by cutting “public service functions” that are not in line with their development direction.

According to the plan, SOEs will transfer water, electricity and heat supplies and property management services for their workers’ family communities to professional companies or organizations.

The move will help the State-owned enterprises to “concentrate on their major businesses, improve basic infrastructures, and further improve the living environment of SOE workers”, according to the State Council.

Submitted by the State-owned Assets Supervision and Administration Commission of the State Council and the Ministry of Finance and then approved by the State Council, the plan is set to finish the transfer before the end of 2018, which means that beginning in 2019, SOEs will not have to pay the “community services” for their workers.

The State-owned capital management budget will offer central government-controlled SOEs subsidies that account for 50 percent of the costs generated by the transfer.

Central government-controlled group companies and companies that supervise the SOEs that undertake the transfer will pay no less than 30 percent of such costs. The rest of the costs will be paid by SOEs themselves.

In the past, SOES usually built living communities for their workers and paid the cost of water, electricity, and heat supplies and property management services of the communities.