We will pursue a more proactive and impactful fiscal policy.
The deficit-to-GDP ratio this year is projected at more than 3.6 percent, with a deficit increase of one trillion yuan over last year. On top of this, one trillion yuan of government bonds for COVID-19 control will also be issued. These are extraordinary measures for an unusual time.
The aforementioned two trillion yuan will be transferred in full to local governments; a special transfer payment mechanism will be set up to ensure that funds go straight to prefecture and county governments and directly benefit businesses and people. These funds should be primarily used to ensure employment, meet basic living needs, and protect market entities. This includes giving support to cut taxes and fees, reduce rents and interest on loans, and increase consumption and investment. It is important to stress that government funds are public in nature and that no such funds are allowed to be withheld or diverted for non-designated uses.
We will work harder to improve the composition of fiscal spending. We will see that spending on people's basic wellbeing is only increased and not cut, ensure spending in key areas, and resolutely cut general expenditures. Construction of new government buildings and wasteful and excessive spending will be strictly prohibited.
Governments at all levels must truly tighten their belt. The central government will take the lead by committing to negative growth in its budgetary spending, with a more than 50 percent cut to outlays on non-essential and non-obligatory items. All types of surplus, idle and carryover funds that should be taken back will be withdrawn and reallocated. We will see that funds are put to better and more effective use; we will scrutinize all expenditure items and see that every cent is used where it is needed most and where market entities and the people will feel the greatest benefit from it.