On August 17, 2021, General Secretary Xi Jinping presided over the tenth meeting of the Central Financial and Economic Commission, which proposed to adhere to the people-centered development concept, promote common prosperity in high-quality development, correctly handle the relationship between efficiency and fairness, and build a basic institutional arrangement for primary distribution, redistribution and tertiary distribution coordination. As an important supplement to primary distribution and redistribution, the three-way distribution has increasingly highlighted its important position and role in China's new journey toward comprehensively building a modern socialist country.
How to recognize primary, redistributive and tertiary assignments
"Distribution" means dominating things according to certain standards. "Distribution" in the economic point of view refers to the distribution of the means of production to the unit of production or the distribution of the means of consumption to the consumer, the former is called the distribution of factors of production, and the latter is called the distribution of the means of consumption. Marxist theory holds that "production determines distribution, and any distribution of the means of consumption is only the result of the distribution of the conditions of production themselves." The distribution of the conditions of production, on the other hand, is manifested in the nature of the mode of production itself." Some scholars also define distribution as the division of national income between the government, enterprises and residents, which is called income distribution from the perspective of flow and property distribution from the perspective of stock. Popularly describe the logic of the three kinds of distribution, the primary distribution emphasizes efficiency, the redistribution shows justice, and the three distributions reflect equality and care.
The three distributions belong to the unique concept of socialist political economy with Chinese characteristics, which was originally proposed by Professor Li Yining in the 1990s, and was gradually accepted by the academic community and eventually adopted by the Party Central Committee. In October 2019, the Fourth Plenary Session of the 19th Central Committee of the Communist Party of China proposed for the first time: "Attach importance to giving play to the role of three distributions and developing social welfare undertakings such as charity." "This is the Party Central Committee's explicit use of the three distributions as an important part of China's income distribution system." In October 2020, the Fifth Plenary Session of the 19th Central Committee of the Communist Party of China once again proposed: "We must play a three-time distribution role, develop philanthropy, and improve the pattern of income and wealth distribution." ”
Primary distribution is a combination of distribution according to work and distribution by factor contribution, which mainly refers to the distribution of income according to the contribution of different factors, such as wages obtained by labor factors, interest and profits obtained by capital factors, land elements obtained rent, and data elements obtained benefits. Redistribution refers to the government departments to fulfill the will of the state, through tax policies, social security, public services and subsidy systems to achieve income adjustment between different income subjects, especially focusing on the fair bottom line, so that all people can enjoy basic public services. The three distributions are the flow of wealth and the distribution of resources carried out by social subjects on a voluntary basis in the form of public welfare such as private donations, philanthropy and voluntary actions. Primary distribution reflects the decisive role of the market in the allocation of resources, redistribution reflects the leading role of government social management, while tertiary distribution reflects the power of social self-organization, self-service and self-improvement, and is an important supplement to primary distribution and redistribution.
The role of China's three-dimensional distribution status has been continuously improved
Since the beginning of reform and opening up, China has established a distribution system with distribution according to work as the mainstay and multiple distribution methods coexisting, which is determined by China's basic national conditions and the level of development of productive forces. As China's society enters a new stage of development, social wealth continues to accumulate, the level of civilization continues to increase, and the status and role of the three distributions are also continuously improved.
The system of the three-way distribution system has been continuously improved. In 1994, the concept of three-way distribution was formally introduced. In 2004, the Fourth Plenary Session of the 16th Central Committee of the Communist Party of China explicitly made philanthropy an integral part of the social security system. In 2005, the Guiding Outline for the Development of Philanthropy in China (2006-2010) was released. In 2012, the 18th National Congress of the Communist Party of China explicitly proposed to "support the development of philanthropy". In 2016, the Charity Law was promulgated and implemented, and local regulations and supporting policies were promulgated intensively. Since 2019, the party and the state have successively issued a series of important documents on three distributions and philanthropy.
The value of the three-time distribution scale continues to increase. According to the data of the "China Charity Development Report (2020)", the total amount of social donations in China is about 133 billion yuan, and the total value of volunteer contributions is 90.359 billion yuan. According to the research data of the China Charity Federation's "2019 China Charity Donation Report", in 2006, China's acceptance of domestic and foreign donations accounted for only 0.05% of the GDP of that year, and this indicator rose to 0.17% in 2019, and some entrepreneurs donated equity to establish charitable trusts, constituting an important form of three distributions. In 2020, there were 482 charitable trusts filed nationwide, and the scale of charitable trust contracts was 2.47 billion yuan.
Volunteer services and non-profit organizations continue to grow. According to the "2020 Civil Affairs Development Statistical Communiqué", as of 2020, the number of registered volunteers in the national volunteer service information system will reach 190 million, and the number of regular social donation work sites and charity supermarkets nationwide will reach 15,000. In 2020, 24.014 million people in the field of civil affairs provided a total of 57.411 million hours of volunteer service nationwide. In 2020, there were 894,000 social welfare organizations nationwide, absorbing 10.619 million social employment, an increase of 3.2% and 5.2% respectively over 2019; the donation income of social organizations was 105.91 billion yuan, an increase of 21.3% year-on-year; from 2016 to 2020, the average annual growth rate of public welfare foundations was more than 10%.
The three distribution subjects and fields are constantly expanding. From the perspective of distribution subjects, resource contributors have shifted from a small number of high-income earners to cover a large number of social groups, and in recent years, the proportion of donations from middle-income groups in various foundations in China has continued to increase, and charitable donation groups tend to be "civilian" and "middle-class". From the perspective of distribution content, charitable acts have gradually surpassed monetary or in-kind donations and tended to various volunteer services; new channels such as online donations, social platform donations and crowdfunding donations continue to emerge. From the perspective of the fields involved, the three distributions have gradually shifted from poverty alleviation to education, medical care, culture, sports, environmental protection and other fields, and from fair results to fair opportunities.
The problems faced by improving China's three-time distribution system
The scale of the tertiary distribution is still very limited. According to the author's research, the growth rate of charitable donations in China is significantly lower than the GDP growth rate, and the proportion of GDP has even decreased. At present, there is still a big gap between the overall scale of China's three distributions and that of developed countries. In 2019, the total amount of US donations reached $449.64 billion, accounting for about 2% of GDP. In 2020, China's GDP will exceed 100 trillion yuan, and if the total amount of charitable donations reaches 1% of GDP, the scale of the three distributions will exceed 1 trillion yuan.
The development of the tertiary distribution is uneven and insufficient. At present, China's three-time distribution structure is not entirely reasonable, charitable donations mainly come from corporate donations, corporate donations accounted for 61.7% of the total scale of donations in 2019, the proportion of individual donations is low, and the source of funds is greatly affected by economic fluctuations. At the same time, the regional differences in China's three distributions are also large, such as the number of foundations in Beijing, Guangdong and Jiangsu provinces and cities accounting for more than 36% of the total number of foundations in the country, the scale of assets accounts for more than 60% of the country, and the overall distribution of charitable forces in the country is uneven.
The laws and regulations related to the three-time distribution are not perfect. At present, China has promulgated and implemented the Law of the Red Cross Society of the People's Republic of China, the Law of the People's Republic of China on Donations to Public Welfare Undertakings, the Charity Law of the People's Republic of China and other relevant laws, but there are still problems of lagging behind in the construction of laws and regulations in the fields of public welfare donations, public welfare recognition, tax incentives and volunteer services, such as the scope of qualification recognition of public welfare donation units is too narrow, the procedures for individual tax reduction and exemption of charitable donations are complicated, etc., especially the issue of tax incentives for charitable trusts needs to be improved.
The positioning of government and social organizations is not clear. According to the author's research, there are problems in the development of Philanthropy in China, such as the vague positioning of government supervision and the lack of supervision and excessive supervision in the development of social organizations. The main reason for these problems is that the role of the government and social organizations in the three distributions is not clear, such as whether the development model is led by the government or social organizations, or the development of the combination of the government and social organizations.
Policy recommendations to promote the healthy development of tertiary distribution
Guide social forces to actively participate in charitable donations. Improve the incentive system and guarantee system, and give play to the role of social moral public opinion and tax inclination. In the national honor system system, enterprises and individuals with a certain amount of donation amount are awarded honorary titles of charity. Encourage the development of various forms of three-way distribution exploration, support the development of charitable trusts and charitable foundations, and encourage citizens to participate in volunteer services. Open up diversified philanthropic channels to enhance the public's experience of participation in public awareness. Vigorously develop digital public welfare, and improve the convenience of donations through Internet fundraising platforms.
Improve the laws, regulations and supporting policies for the three-time distribution. Give play to the incentive role of taxation on social donations, appropriately relax the pre-tax deduction limits for donations, and simplify the procedures for charitable tax deductions. Taking the charitable trust system as a breakthrough, explore the tax incentives for charitable trusts, especially to improve the preferential tax policies for public welfare equity trusts. Encourage local governments to explore more detailed institutional arrangements for the implementation of relevant laws and regulations for the three distributions.
Clarify the role of the government in the three allocations. Adhere to the party's leadership over the three distributions, and establish a diversified governance system composed of the government, industries, charitable organizations, and the main body of public opinion. Clarify the responsibilities of government supervision, strengthen top-level design, policy guidance and management supervision. Highlight the main position of social organizations in the three distributions, and introduce competition mechanisms and evaluation mechanisms. Establish incentive and constraint mechanisms to effectively balance the interests of multiple parties in society.
Build a charitable organization model suitable for China's national conditions. Strengthen the standardized development of charitable public interest organizations, and cultivate modern charitable public interest organizations. Establish specialized social organization management teams, strengthen the establishment of charitable organizations' credibility, improve mechanisms for tracking and feedback on the use of charitable funds, and increase the transparency of information disclosure. Establish supervision mechanisms that combine internal and external aspects, improve internal oversight of charitable organizations, and strengthen the entire society's external supervision of the operations of charitable organizations.
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