Published on China Development Brief (http://www.chinadevelopmentbrief.com)
    
    Community development and political reform in urban China
    By CDB Created 2002-10-01 16:18 As unprofitable state owned enterprises are closed and others are transformed into independent economic entities, the foundation of the Chinese political and social system in urban areas — the danwei (work unit) — is becoming irrelevant. Millions of people no longer have access to the social services the danwei used to provide. Increasing unemployment, a growing number of transient workers, a rapid increase in the number of people employed outside the public sector, smaller families, an aging population, and a desire for improved living standards all contribute to increased demand for social services, just at the time that they are being cut. This may at least partly explain growing assertiveness in the urban population. According to official statistics, work-related disputes increased 14-fold between 1992 and 1999. In March 2002, upwards of 50,000 laid-off workers demonstrated for over a month, demanding unpaid benefits and pensions in Daqing, Heilongjiang. Such events threaten the legitimacy and stability of the regime. As part of a social reform programme to address this, the Ministry of Civil Affairs (MOCA) began in the late 1980s to re-designate some of the old Neighbourhood Committees as shequ ('communities'). MOCA wanted the shequ to take over some of the traditional social welfare responsibilities of danwei. Within a few years of their creation, shequ have spread throughout China and have been active in such areas as senior and youth centres, environmental programmes and health services. To encourage this process, in the late 1990s MOCA designated districts in eleven cities as 'experimental' and for the first time gave shequ limited policy-making autonomy.1 In 2000, the experiment was expanded to ten other cities.2 The importance of this experiment should not be underestimated. Premier Zhu Rongji has said shequ will be the foundation of a new social welfare system, and also 'increase local democracy' and strengthen 'political construction.'3 More-over, the experiments mirror the
    
    trend in Western countries towards 'reinventing government' based on the idea that government 'should steer and not row.'4 Although the Communist Party has historically been hostile to any organ-isation that operates outside its control, the Party leadership has acknowledged the need to develop social organisations. In a 1997 speech, Jiang Zemin stressed the need to 'cultivate and develop . . . social intermediary organisations' to support ongoing reforms.5 A plan for restructuring the social sector, approved by the First Session of the Ninth People's Congress in 1998, stated that many of the functions of government organs should be 'given back to society'. The experimental shequ were introduced in 1999 as part of the policy reforms. Benefits of devolving responsibilities to shequs include: lower investment costs; more efficient governance, and increased social interaction among residents. This latter benefit makes people "more aware of their common interests and motivates them to participate in building the community."6 Seemingly, the government wants people involved in solving their own problems rather than relying on the state. But while shequ can to some extent be viewed as social organisations, they clearly differ from other 'third sector' organisations that do not have a budget provided by the state, must be approved by the state, have an official sponsor, and can be banned. Shequ are quasi-state entities with both governmental and societal functions. Urban government structures There are three official levels and one unofficial level of urban administration. Each level has both a vertical and a horizontal relationship with related government units. For example, Civil Affairs officials have to report both to the national Civil Affairs bureaucracy and to local government. This complicates policy making and implementation. The first administrative level is the municipal (shi) government. This comprises numerous departments responsible for law and order, finance, trade, and economic enterprises located in the city. Municipal departments are both part of the local government and part of the vertical administrative system linked with the central ministries. Departments such as People's Courts and Public Security interact closely with their parent ministry in Beijing while departments that handle social welfare have more interaction with the municipal government. Cities are divided into districts (qu). For example, Shanghai is divided into ten districts. Each of the districts 'elects' a district People's Congress, which in turn selects a People's government as the executive organ of the district. The districts are responsible for economic development, police, education, hospitals, and other social services. They are given a budget by the municipal government and have limited taxation authority.
    
    Districts are in turn subdivided into sub-districts (also known as street offices — jiedao banshichu): Shanghai's 10 districts are divided into 115 sub-districts. The role of the subdistrict has greatly expanded over the years. Their responsibilities include day-to-day administration of public security, social mediation, birth registrations, and so forth. Since the sub-districts have very limited taxation authority, the majority of their budget is provided by the district. Below these three official tiers of government are the neighbourhood committees (jumin weiyuanhui - NC). Article 111 of the Chinese Constitution defines these as 'mass selfmanaging organisations at the grassroots level.' In reality, they serve as appendages of the sub-district offices. In Shanghai there are 2,400 NCs, with around 1,000 families under each. In most places the NCs are smaller, and administer some 100-700 households. The NCs are responsible for publicising laws and policies, protecting residents' legal rights and interests, mediating civil disputes, and helping maintain public order and security. They have also served to mobilise people who could not be reached through other mass organisations or the danwei (eg, housewives, unemployed, pensioners) in activities such as political study groups, organising and managing small enterprises, and administering health, educational, and cultural programs. The NCs have also acted as the eyes and ears of the local Public Security Bureau. As such, until the 1980s, most residents viewed the NCs not as autonomous community organisations, but as 'nasty and meddlesome' agents of the government.7 Traditionally, the sub-district appointed the NC leaders and gave them a small stipend. Evolution of shequ The shequ evolved from these NCs in three distinct phases. 1980-1990 With the economic restructuring in the 1980s, the NCs were first given the authority to provide services for their residents. At the end of the 1980s, NCs in some areas were re-named shequ; in others, separate shequ were founded alongside NCs. Both were expected to carry out social functions traditionally fulfilled by danwei and the government. To support this mission, the government started to professionalise NCs by replacing pensioners who served as the leaders with younger, better educated people and improving training, pay and benefits. Nevertheless, limited resources and a lack of political authority kept them from providing significant services for their residents. 1990-1998 Continuing social problems and the failure of NCs/shequ to provide adequate services led to a series of MOCA-sponsored conferences in the early 1990s. From these emerged a 'shequ construction' (shequ jianshe) policy, which had two somewhat conflicting goals: increasing local government powers, to improve its problem-solving capacity, and encouraging shequ to take a more active role in providing services for residents.
    
    The nature of shequ also changed during this period. Previously, they had either been separate entities or were NCs under a new name. As shequ construction continued, NCs were in many cases merged with shequ. The scope of shequ activity became much broader than anything that preceded them. 1999 — to date: The perceived success of these ad hoc experiments led MOCA to designate 11 shequ as experimental shequ. Two years later, a further 15 shequ were given experimental status. This enabled them to try new polices without explicit central government authorisation. It also gave shequ some protection from local governmental officials who resisted any dilution of their authority. So what's new? shequ have more residents and are geographically larger than NCs, and have more control over their affairs. In some areas they are not bound by administrative rules that restricted NCs and danwei. And they are starting to take over not only the social welfare tasks of NCs, but those of sub-district offices and danwei. shequ leaders are on the whole younger, more educated, and better trained then NC leaders. Perhaps most significantly, a growing number of shequ directly elect their leaders and in some cities (Nanjing, Shanghai, and Wuhan), a Representative Assembly (Shequ Jumin Daibiao) has some supervisory oversight. Because of their links with the local government shequ cannot be considered as autonomous organisations, but their role is broader than that of the NCs they are replacing. One concept, three models Three general models of shequ have emerged. The first is the 'Shanghai model.' Developed during the mid-1990s and at one time considered the standard for community development, decision making power in this model remains with the sub-district level of government, which delegates responsibilities to shequ. This is described as 'two levels of government, three levels of management.' In other words, while the district and sub-districts are still in charge of making policy, shequ play a key role in implementing it. The goal of this arrangement was to improve city management, not foster citizen participation. For example, although shequ leaders are technically elected, they are in reality appointed by the sub-district. In other words, with the exception of some additional responsibilities and the establishment of local branches of city departments in the shequ, the relationship between shequ and the government is similar to the traditional one between NCs and the sub-district government. Other cities with this model include Beijing, Foshan, Hangzhou, Nanjing, and Tianjin.
    
    However, since the Shanghai model has essentially increased the power of the sub-district government rather than develop the third sector, shequ officials have come to view it as outdated and inflexible. A 'Shenyang model' has been more innovative. This is not surprising given that Shenyang, located in China's industrial rustbelt, has been hit hard by market reforms, which have led to high levels of unemployment and a shortage of money for healthcare and pensions. This has encouraged the municipal government to experiment, seeking a greater role for shequ. The Shenyang model is based on the idea that the state no longer has the resources to solve growing social problems and so more responsibility must be given to the citizens. In this model, shequ act as a separate level of administration: there has been structural change in the administrative hierarchy. Shenyang shequ are geographically based and were created through the merging of NCs. They have significant policy-making autonomy and are governed by a 'Community Council.' Within this Council there are four groups: a Party leadership group, a government representatives group, a community self-government group (representing residents, institutions such as schools, and businesses) and a management committee, which is often directly elected. This model encourages creativity in solving community problems, but has encountered the problem of taking on too many responsibilities, with the result that the shequ leadership often had difficulty efficiently administering their communities. According to one Chinese observer, MOCA supported this model because it distanced the sub-district from the shequ and was thus viewed as the first step in separating community organisations — and their problems — from the government.8 But this model has lost favour since its leading proponent, Shenyang Mayor Mu Suixin, was convicted of corruption. He is now serving a life sentence. The 'Wuhan Model' has features of both Shanghai and Shenyang models. It is based on two levels of government, three levels of management, and four levels of enforcement.' While shequ priorities are still determined by the local government, this model gives them some additional resources and some autonomy in implementing policy. Government has more control than in the Shenyang model, but the Wuhan model can still be seen as an attempt to separate shequ from the government. This is the current 'MOCA approved' model of shequ development, although the active involvement of local government limits the control that shequ have. Qingdao's freelance experiment An interesting development has recently taken place in Qingdao, where local government is experimenting with a new model of shequ development in the Fushanhou residential area. At first, the Hefeilu sub-district was in charge of the shequ, but, as Fushanhou grew, the sub-district could no longer fulfil its
    
    obligations. Instead of creating a new sub-district, as was the practice in the past, Qingdao created an autonomous shequ. However, because of its size — over 1600 households — there are four NCs under the Fushanhou shequ, in contrast to the Shenyang model of a single level of administration. Other noteworthy features of the Qingdao experiment include a unique organisational structure. There are four components: a CCP committee, a 'Community Democratic Consultation Council (CDCC),' a shequ service centre, and a shequ leadership council. The CDCC has around 25 members and is led by a chairperson appointed by the district. The membership comprises people from local businesses, interest groups, schools, representatives from the community, the Communist Party, and the NCs. Currently, the Council is an unelected, ad hoc body; however, local Civil Affairs officials believe that in the near future the Council will directly elect its members and leadership. This model could have significant implications for the future evolution of shequ. First, it fosters civic involvement. Fushanhou shequ has only 16 full time government bureaucrats, many fewer than the sub-district government which it is substituting. These 'missing officials' have been replaced with volunteers. This also reduces local administrative costs. Second, this model provides more autonomy as both the shequ and NCs are separate from the government. Some national Civil Affairs officials have suggested that the Fushanhou model is 'illegal'. One scholar believes this is because MOCA is afraid this model of shequ development would put too many MOCA officials out of work.9 Administrative structure Shequ organisation varies but the most common configuration includes a Representative Assembly (RA) and a Leadership Council (LC). The RA has 40-100 members. As well as residents, it includes representatives of NCs, government bodies, work units, social organisations, the sub-district government and Communist Party. Shenyang's Jiaoshi Zhijia shequ has 1960 residents and a 100 member RA, or one representative for every 23 families. In contrast, Qingdao's Shinan shequ has a 50-member assembly for 10,000 residents. The RA makes the 'big decisions' for the shequ. These include selecting leaders, approving a development plan and budget, changing shequ rules, and if necessary, overruling the LC. The RA can meet as often as once a month (Shijiazhuang) or as infrequently as once every six months (Tianjin). The Leadership Council is the executive arm of the RA. A typical LC has six members and meets at least once a week. While in theory the RA makes decisions and the LC implements them, in reality the LC has more power. Shequ responsibilities
    
    Shequ are still responsible for the NC's tasks, and in most shequ, the LC oversees a number of departments whose functions broadly correspond to the responsibilities given to NCs by the 1990 Neighbourhood Committee Law. They include Party activity, birth control, security, social mediation, services, and culture and entertainment. Some shequ have also established departments to address specific problems in their community. Examples include a Pensioners Department in Shenzhen and an Economic Department in Chongqing. Each department is headed by a member of the LC who is aided by volunteers, danwei representatives, members of the shequ RA, and residents with a particular interest or skill related to the department. Although these departments are in theory separate from the local government, in many shequ the department head is appointed by the sub-district office. However, some shequ have expanded beyond the NC's formal mandates. For example, a shequ in Jimo City (on the outskirts of Qingdao), formed several local enterprises to provide jobs for residents. In Wuhan, shequ provide simple medical services. Shenyang offers worker retraining and job placement programmes. Shenzhen and Harbin provide homecare (cooking and cleaning) for elderly and disabled residents; Shijiazhuang provides a health/exercise centre and entertainment for the elderly. Ji'nan's services include household maintenance and appliance repair, homecare and nursing, basic medical services, day care facilities, and even a dating service. Qingdao hires out laid-off and underemployed workers for maintenance and home repair work, provides day care, worker retaining, entertainment, and has created social service telephone hotlines. Leadership selection Leadership selection is governed by the 1990 Neighbourhood Committee Law which states that the LC should be elected either by all residents, by an electorate consisting of one member from each household, or by the RA. In fact, only a small minority of shequ leaders are directly elected. In some areas (Foshan), they are appointed by local government. In others (Chongqing, Tianjin, Ji'nan), they are indirectly selected; and in some they are chosen by direct election (Beijing, Guangzhou, Shenyang, Shanghai, Shenzhen). In Tianjin, indirect selection works as follows: 1) The sub-district issues an announcement that shequ leaders will be hired. To be eligible, applicants must meet certain criteria (age, education, experience). Some shequ have a residence requirement and some do not. 2) Interested candidates take a competency test. 3) Candidates with the highest test scores are then interviewed by local government officials. 4) More candidates are nominated than are needed, e.g. eight people for five positions. 5) The 'platforms' and biographies of the eight candidates are circulated in the shequ. 6) The shequ RA then votes. The candidates with the most votes become the members of the shequ LC. To be selected, a candidate must receive over 50 percent of the RA votes.
    
    Indirect selection of this kind is currently the most common method of selecting shequ leaders. This suggests that the central and local governments are trying to improve the quality of public servants through more stringent screening and also willing to foster citizen involvement. A few shequ have taken advantage of opportunities to hold direct elections. in Shanghai, these are conducted as follows: 1) Residents and sub-district officials nominate candidates; 2) Their names are submitted to the RA where their merits are discussed. At this stage, some candidates withdraw and some are disqualified. 3) The RA, Communist Party cell, and sub-district representatives listen to speeches and narrow the field of candidates to eight. 4) Using posters, speeches, etc, the candidates campaign for a week. 5) All shequ residents over age 18 have the right to vote. The eight candidates with the most votes win. Despite limits on who can stand for election, this represents a significant step towards a democratic electoral process. Once the LC is selected, a secret vote is held to select the Chair and Deputy Chair. The Chair earns around CNY 1000 — 500 per month, while the other LC members earn around CNY 500. The members of the LC are the only paid administrative employees in the shequ. As with most shequ expenditures, the leaders' salaries are paid by the subdistrict. NC leaders were predominantly retired Party members. It is harder to create a profile of an average shequ leader. In Harbin, they were lively, middle aged women while in Foshan a recent college graduate was in charge of the shequ. The factor that seems to most affect the characteristics of shequ leaders is the method of leadership selection. If appointed or chosen by an indirect election, in general leaders had more education, administrative experience, and were younger than 45 years old. In the shequ with direct elections, the leadership was much more diverse. Nevertheless, there is a clear trend toward youth and education. Of 244 applicants who passed the shequ examination in Chongqing, all were younger than 45 (the average age was 36), 145 had completed high school and 122 had some form of higher education. Another interesting trend is the separation of residency from employment. In Chongqing's Xiaoyuan shequ, only one of the five LC members lived in the shequ. While still relatively novel, by removing residency requirements the shequ is able to expand the pool of potential candidates and possibly improve the quality of shequ leaders. While Party membership helps, it is not an absolute criterion for selection into the LC. In the 11 shequ we visited, approximately 40% of LC members were not Party members. However, the Chair of each shequ, with the exception of Foshan, was a Party member.
    
    Shequ goals: What is the government trying to achieve?
    
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    Integrate economic and social development. These were closely linked in the first 25 years of communist rule, but economic reforms have caused these spheres to separate. By taking over and improving some government services, it is hoped shequ will reestablish the link between economic and social development, improving the quality of life for urban people. Reduce government expenditures. Government streamlining will be aided by shequ taking over certain social services. Share resources and expertise. Bureaucratic compartmentalisation has made it difficult to share resources. Shequ can bring a unified, bottom-up approach to local affairs.
    
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    Strengthen local government. By improving the management of local government, shequ can help it become more effective, while also bringing government closer to the people and enhancing its legitimacy. Foster social involvement. Since shequ are not part of the government, it is hoped they will foster contacts between the state and society by 'getting closer to the masses.' Strengthen CCP control. Jiang Zemin has said that 'shequ construction . . .will strengthen the Party's mass and organisational base in the city.' Shequ are required to explain the Party's policies to urban communities, as well as following its guidelines and rules.
    
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    Source: Summarised from authors' interviews with officials and interpretation of official documents Decision-making In China, most administrative decisions are made behind closed doors and then disseminated to the populace. In general, shequ follow this tradition. The frequency of LC meetings varies from city to city. Most hold regular weekly, biweekly or monthly meetings. Tianjin has daily meetings. Meetings in some cities are open to the public (Shenyang, Shijiazhuang, Wuhan, Tianjin, Nanjing, Harbin, and Foshan) and in others the public is forbidden to attend (Ji'nan, Shenzhen, and Shanghai). Of the 11 shequ visited, 6 were closed and 5 were open to residents. Even in 'open' meetings, public participation is limited: the meetings are not usually publicly advertised and residents have to leave when decisions are made.
    
    Finances In nearly all the shequ we visited, 90%-100% of the budget was provided by the subdistrict government. The sub-district receives most of its operating funds from the district, but also raises money from local taxes, which are often collected by the shequ. The remainder of shequ finances come from personal and business donations as well as user fees for community services. As examples of the latter, the Shinan shequ in Qingdao charges a 20% commission if they are asked to bring in an outside contractor to fix problems in residents' apartments; and the Lianbao shequ in Wuhan collects a few yuan from each family to pay for cleaning and security guards. Shequ also benefit from preferential tax policies. Businesses run by shequ which hire unemployed workers are exempt from some taxes. While these features give shequ some financial leeway, dependence on govern-ment budgets means local government can determine shequ spending priorities. However, most government and shequ officials and academics we interviewed predict that the government will soon reduce its fiscal support, pressuring the shequ to find their own sources of revenue. Yet, while many shequ leaders want the ability to levy taxes, local government officials are strenuously opposed to this devolution of power. Obstacles to shequ development Lack of trained administrators and the historical absence of professional community workers are major obstacles to shequ development. Low pay also lowers the quality of applicants. Salaries are less than half the average urban wage and work in shequ administration lacks prestige. As a result, leadership positions do not usually attract wellqualified candidates. As noted above, some shequ have attempted to address this by introducing competitive exams.This is part of a MOCA national strategy to base government employment on merit. There are also growing calls for professionalizing community workers through educational programs, training, and increased salaries. Some cities have already made progress in this area. For example, in Qingdao a 'Shequ College' was created, offering for CNY 850 a six month course in law, shequ construction, economics, administration, and 'social investigation' techniques. The Chinese administrative system also limits shequ development. The legacy of central planning is difficult to overcome: in several shequ we visited, the local government had a 5 Year Plan for shequ development. At the same time, excessive compartmentalisation of government constrains collaboration between the Ministry of Civil Affairs, responsible for basic level governance and social organisations, and the Ministry of Labour and Social Security.
    
    Moreover, there is little communication between shequ from different areas. The leaders of the Shenyang community we visited had never been to a shequ outside their district. The only opportunities they have for sharing successes and failures with counterparts from elsewhere are occasional, regional or national conferences and/or MOCA meetings. Local government officials overseeing shequ development have much more regular contacts with their counterparts in other cities than the community leaders responsible for implementing the shequ models. Another bureaucratic obstacle is the reluctance of local MOCA officials to allow shequ any real degree of self-governance. The shequ do not in practice enjoy the autonomy that regulations formally grant them: indeed, many local governments have created 'working committees' to limit shequ autonomy. According to a MOCA official in Shandong, this is largely because local officials fear losing their jobs. As a result, to date shequ have served more as a branch of the sub-district government than as a voice for their constituents. Shequ development is also limited by the imposition of too many responsibilities with inadequate resources to discharge them. Higher levels have saddled them with an increasing number of tasks, from selling saving bonds and newspaper subscriptions to surveying residents and ensuring street signs are posted. In Qingdao, 160 functions that used to belong to the sub-district were divided between the shequ, government funded service centres, and social groups (charity organisations).10 A MOCA official estimated that shequ have 40-100 legal obligations or responsibilities.11 Yet the sub-district only provides enough money to pay for salaries, space, and utilities. Some shequ have responded by soliciting donations from local businesses or attempting to start their own businesses. These activities are usually discouraged by government officials because they don't believe shequ leaders have the necessary skills, they see fundraising as a distraction from community development and service provision, and/or because greater financial independence for the shequ amounts to loss of control by the sub district. Legal ambiguity also hinders shequ development. Although partly guided by regulations designed for NCs, these have little direct bearing on the changed situation of the shequ; and there are no laws that define the shequ's responsibilities, powers, or relationship with the government. Some shequ have taken advantage of this legal vacuum to try new policies, but overall their lack of legal status weakens their position. Without legal status their operations are completely dependent on the discretion of government officials. Moreover, as they are not legal entities they cannot borrow money, sign contracts, enforce rules, etc. But perhaps the biggest impediment to shequ development is the Communist Party itself. According to one Party cadre we interviewed in Ji'nan, the Party has held a series of conferences on how to ensure Party control of the shequ. Around 70% of shequ LC members are also Party members, and there are Party cells in every shequ. This clearly
    
    limits the extent to which shequ can really be 'autonomous,' despite this being one of the experiment's declared objectives. However, the shequ experiment also shows how, as the Chinese economic and social system develops, the interests of the Party and the government are no longer always identical. While the overriding interest of the Party is to ensure political control, local governments are often more concerned with economic development, balanced with service provision; and some have thus proved willing to give shequ significant autonomy, even at the cost of some political oversight. The long legacy of government and Party control of nearly all aspects everyday life, and continuing institutional control of shequ, also has negative consequences for public participation. Residents tend to think of shequ as government entities designed to ensure compliance with government policies. This problem is amplified by traditional administrative habits. In most shequ the meetings of the LC are closed to the public and officials are more used to giving orders and fulfilling plans rather than fostering political participation. As a result, most residents do not think shequ represent their interests and/or that their involvement will have any impact on the community. Consequently, less that 15 percent of shequ residents are involved in shequ activities.12 Many shequ staff told us that the majority of their residents did not understand what 'community' means, let alone what role they should have in them. Residents are not used to taking responsibility for themselves or identifying with the community they live in. Yet in Beijing's Chaoyang District, 68% of residents said they would be willing to get involved in community projects if given the opportunity to do so.13 This is a crucial factor, for without citizen involvement, shequ will be little more than a part of the government. Two things must happen for shequ to realise their potential: the government must stress their importance and encourage participation and people have to learn how to be citizens rather than subjects. In what can be seen as an attempt by the central government to address the first condition, shequ are being allowed to hold direct elections. In Hangzhou's Jingfang shequ, 80% of residents voted in a December 2001 election. Resident forums and community projects may be steps towards developing a stronger sense of citizenship. Critical ambiguities The ambiguities and uncertainties discussed above are reflected in the lack of a commonly agreed definition of shequ. Official and unofficial definitions encountered during our research include: 'an area and unit of people,' 'an enlarged neighbourhood committee,' 'the government's representative at the local level,' 'a self-governing entity,' and 'an autonomous association that solves residents' problems.' This ambiguity spills over into uncertainty as to what services shequ should provide. For example, the Shinan shequ in Qingdao performs both governmental functions (eg, registering marriages) and
    
    resident support functions (a recreational centre for pensioners). The role of government in shequ development remains unclear. Government has so far had a leading role. This "constrains resident's involvement in shequ construction . . . and is not good for achieving the goal of a 'small government, big society."14 Many local government officials view shequ in the same way they viewed NCs, as subordinate to the local government. Yet Civil Affairs officials at the central level want shequ to solve problems on their own. This places local government officials in a difficult position. One in Shenyang defined 'shequ' as 'local affairs managed by local people,' but later added that shequ should act as 'agents' of the local governments and be 'guided and helped' by them. While not mutually exclusive, these answers illustrate the contradiction between maintaining control and fostering the development of autonomous communities. Until the powers of shequ are clearly defined, particularly in relationship to the local government, it will be difficult for them to play a significant role in the polity. This stems from the larger issue of defining the future relationship between the government and the people. Although most government officials we spoke to understand there has to be a change in the relationship between the state and society, they are unsure how to accomplish this while still maintaining political control. This dilemma can be seen in the Minister of Civil Affairs' description of shequ construction. Although first noting 'the fundamental programme is to strengthen the Party's position in the city,' he went on to say that shequ construction should include political reform (the enlargement of local democracy) and system reform (changing the functions of government and the relationship between the sub-district and shequ).15 Complex process, piecemeal progress In terms of the goals elaborated by MOCA officials (see panel) the results of the shequ experiment have so far been mixed. While 'cities which (have) tried community management and reform have had marked results'16 most cities have not actively supported shequ development. This situation is the result of three factors first identified by White in his 1991 study of local government in China.17 First is the complexity of a changing urban economy and society. Second, the local governmental structure is very integrated, thus reforms at each level are dependent on the success of reforms at another level. Third, the development of shequ goes beyond the relatively 'safe' sphere of economics to the much more sensitive areas of administration and politics. In other words, since economic production, social welfare, and political control have been historically intertwined, change is a complicated and difficult undertaking. Another factor that has limited shequ development is the lack of a theoretical framework to guide shequ development. In the absence of a comprehensive political framework that has a place for community organisations, the shequ development process will be piecemeal at best.
    
    These obstacles notwithstanding, some shequ have been much more 'active' than others. Key variables seem to be the local economic and political environment and the effectiveness of the local leadership. For example, since the economic situation is so dire in Shenyang, local leaders have been very supportive of shequ. Consequently, most of the shequ there have been very active, with some going so far as establishing worker retraining and employment centres. While Shanghai's shequ are also relatively active, this is the result of very different political and economic circumstances. The shequ experiment was favoured by the city's former mayor, Xu Kuangdi and since Shanghai has one of the highest living standards in China, shequ have access to significant resources. Overall however, our research suggests that 'active' shequ are the exception rather than the rule. Like NCs, shequ have been implementers of local government policy and not advocates of local interests. According to the MOCA Director for Shandong, 90% of shequ activities in the province are implementing government programs or fulfilling government regulations. Nevertheless, it would be a mistake to simply think of shequ as part of the government. Although they have some of the characteristics of a state entity, they also have features that differentiate them from the bureaucracy. These include elections, various organisational designs, and wide-ranging interactions with citizens. While our interviewees believe shequ will be given more authority and responsibility in the future, the crucial determinant of successful shequ development will be whether the state 'can effectively transfer power to the lower levels of society.'18 In other words, will shequ become the autonomous social organisations envisioned by some officials or will they, as in the case of NCs, be subsumed into the government apparatus? While no one can answer this question with any certainty, key things to watch for include an increasingly diverse community that generates a broad range of service demands, a more service oriented organisational structure, a professional staff, democratically elected leaders, and increased citizen participation. As the elections in Hangzhou and the shequ college in Qingdao show, some of these things are already occurring.
    About the article:Jim Derleth is a Professor at the Payson Center for International Development at Tulane University. He specializes in democratisation, development, and comparative politics. Daniel Koldyk is a political officer in the China and Mongolia Division at the Department of Foreign Affairs and International Trade in Ottawa. Derleth and Koldyk were the principal investigators for a Canadian International Development Agency (CIDA) project on shequ development. This article was digested from a longer paper prepared by the authors. The full version of the paper can be obtained by contacting them: jwderleth@yahoo.com daniel.koldyk@dfait-maeci.gc.ca The research on which this article is based was made possible by support from the Fulbright Program and the Civil Society Program of the Canadian International Development Agency (CIDA).
    
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    Chosen to reflect regional variation and different levels of economic and political development , the eleven were located in Beijing; Chongqing; Haikou, (Hainan); Nanjing, (Jiangsu); Qingdao (2), (Shandong); Shanghai; Shenyang, (Liaoning); Tianjin; Wuhan, (Hubei); and Xi'an (Shaanxi). 2 Benxi, (Liaoning Province); Changchun, (Jilin); Foshan, (Guangdong); Hangzhou, (Zhejiang); Hefei, (Anhui); Kelamayi, (Xinjiang); Luohe, (Henan); Shenzhen, (Guangdong); Shijiazhuang, (Hebei); and Xiamen, (Fujian). 3 Quoted in Mingliang Zhang, "The Background and Tasks of Shequ Construction," in The Theory and Practice of Shequ Construction (Beijing: Beijing Academy of Social Science, 2001), 11. 4 See Hillel Schmid, Neighborhood Self-Management: Experiments in Civil Society (New York: Kluwer Academic/Plenum Publishers, 2001), 27-29. 5 Jiang Zemin, "Hold high the great banner of Deng Xiaoping Theory for all around advancement of the cause of building socialism with Chinese characteristics into the 21st century," Beijing Review, 6-12 October 1997, 10-33. 6 "Improve Community" China Daily, 23 December 2000, 2. 7 Martin King Whyte and William L. Parish, Urban Life in Contemporary China (Chicago: University of Chicago Press, 1984), 289-90. 8 Jianguo Gao (Professor, Shandong University), interview with authors, 9 Tongchang Liu (shequ specialist at the Qingdao Academy of Social Science), interview with authors, Qingdao, Shandong, 3 June 2002. 10 Tianyun Meng, "The Fushanhou Model Shequ in Qingdao," paper presented at symposium, International Symposium on Community Development and Public Participation in China, Shandong University, Ji'nan, 17-18 May 2002. 11 Baokun Li, "Study Carefully, Work Hard, Improve Steadily," Chongqing Jiangbei District Shequ Construction: Material Collected (Chongqing: Shequ Construction Direction Committee of Jiangbei, Chongqing, December 2000), 76. Li is a MOCA Deputy Minister. 12 Qingshan Wang, "Community Autonomy: The Goal of Public Participation," paper presented at symposium, International Symposium on Community Development and Public Participation in China, Shandong University, Ji'nan, 17-18 May 2002. 13 Rong Yang, "Public Perception in Community Building," paper presented at symposium, International Symposium on Community Development and Public Participation in China, Shandong University, Ji'nan, 17-18 May 2002. 14 Jianbo Li, "Sub-district and Neighborhood Committee: Comparison between Two Models of Shequ Construction," in Xiaolu Luo and Zhongliang Ma, eds., Community Development in China (Beijing: Beijing Academy of Social Science, 2000), 179. 15 Zhang Mingliang, "The Background and Tasks of Shequ Construction," The Theory and Practice of Shequ Construction (Beijing: Beijing Academy of Social Science, 2001), 12. 16 According to Jiyun Tian, Vice-Chairman of the Standing Committee of the NPC, "urban committees have played an important role in helping the government offer services to residents" and are serving as a "training class" for urban democracy. "Committees Cultivate Grassroots Democracy," China Daily, 29 August 2000. 17 Gordon White, "Basic-Level Local Government and Economic Reform in Urban China," in Gordon White, ed., The Chinese State in the Era of Economic Reform
    
    (Armonk, New York: M.E. Sharpe, 1991), 240. 18 "Deepening Government Reform," China Daily, June 8 2000, editorial section, 4. Source URL: http://www.chinadevelopmentbrief.com/node/159

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