Fellow Deputies,

The Ministry of Finance has been entrusted by the State Council to submit this report on the implementation of the central and local budgets for 2010 and on the draft central and local budgets for 2011 to the Fourth Session of the Eleventh National People's Congress (NPC) for your deliberation and approval, and also for comments and suggestions from the members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC).

I. Implementation of the Central and Local Budgets for 2010

In 2010, under the firm leadership of the Communist Party of China (CPC), the people of all the country's ethnic groups forged ahead in solidarity and worked tenaciously, and all localities and departments took Deng Xiaoping Theory and the important thought of Three Represents as their guide, thoroughly applied the Scientific Outlook on Development, comprehensively carried out the decisions and arrangements of the central leadership, and conscientiously implemented the relevant resolution of the Third Session of the Eleventh NPC. The national economy developed steadily and rapidly, society remained harmonious and stable, and new significant achievements were made in reform, opening up and socialist modernization. On this foundation, steady progress was made in fiscal development and reform; a basic framework of a government budget system that comprises budgets for public finances, government-managed funds and state capital operations was put in place; budgets for social security funds were compiled on a trial basis; and government budgets were successfully implemented.