Highlighted in a recent circular from the State Council General Office , the establishment of a “two-way random inspection” mechanism is expected to solve the imbalance between supervisors and the supervised, and also curb the power of rent-seeking in supervisory activities, analysts said.

The policy, which involves selecting both the targets of the inspections and the inspectors randomly, will be promoted extensively in market supervision and supervisory activities of various government departments.

Promoting a service-oriented government

In recent years, two phases concerning China’s reform of its administrative approval system have been implemented. The first phase has involved slashing the excessive approval rights of the government, and the second has focused on designing and implementing a series of mechanisms to conduct supervision in accordance with the law.

The establishment of the random inspection mechanism calls for reshaping administrative culture and restructuring government duties. It is thus crucial for ensuring that the government is responsible, transparent and service-oriented.

One popular change concerns promoting reform in both systems and mechanisms while transforming government functions. The creation of the random inspection mechanism can be seen as an example.

The success of many significant reforms in government systems is due to the government’s ability to improve its mechanisms. Random inspection, which is more operable and realistic, can effectively fine-tune mechanisms of a service-oriented government.

Publishing inspection results to guarantee transparency

Random inspection does not mean inspection at will. Successful implementation of the policy depends greatly on:

Firstly, formulating a list of inspection items. The list will prescribe relevant procedures, laws, power boundaries, and measures concerning rewards and punishment. Supervisors cannot overstep their authority, but can make innovations within their sphere of influence, to raise efficiency and also awareness about changes in political circumstances.

Secondly, creating and updating databases for market participants and supervisors. The inspected will be chosen publicly by lottery, thus aiming to eliminate human factors and to do the utmost to prevent bribery and corruption.

Thirdly, local governments and departments are also required to establish a “reasonable ratio and frequency” for the inspections and punish illegal behaviors, as a sort of deterrent.

Redesigning supervision procedures is set to compel the authorities to fulfill their supervisory obligations, and also help avoid arbitrary inspection.

Combining joint supervision and administrative service

Regarding the high volume of cases if illegal activity in some parts of the country, the circular calls for joint inspection, which refers to inspecting various items of one market participant at the same time.

Joint inspection is highly efficient and low risk, and can result in much pressure on the supervised - and thus act as a deterrent.

Additionally, joint inspection requires the coordinated activities of various government departments in order to provide seamless services to the public.

Combining credit supervision and data sharing

Credit serves as the cornerstone of a market economy, and the circular called on the random inspection system to connect with the social credit system.

The government will adjust credit information according to the inspection results while a credit information database for enterprises can serve as a measure for determining inspection frequency.

The credit system for enterprises, involving relevant laws and regulations, service institutes, supervisory system and punishment, is set to create a market characterized by integrity and discipline, so as to reduce government intervention and cut administrative costs.