26 October 2016
Wang Zhenyao, who was involved in relief efforts following China's devastating Sichuan earthquake in 2008, has dismissed reports of fund misuse. Photo: HKEJ
Wang Zhenyao, who was involved in relief efforts following China's devastating Sichuan earthquake in 2008, has dismissed reports of fund misuse. Photo: HKEJ

Sichuan quake funds were well monitored, says ex-China official

The donations collected after the 2008 Sichuan earthquake were monitored properly and put to good use, a Chinese official involved in the disaster relief operation said, dismissing a recent media report that suggested that some of the funds may have been misused.

“I coordinated a large part of the 76.2 billion yuan (US$11.62 billion) donations at that time,” Wang Zhenyao (王振耀), former head of disaster relief division at China’s Ministry of Civil Affairs, told EJ Insight in an interview in Hong Kong last week.

About 70 to 80 percent of the money was allocated to the government account as most NGOs involved in the relief efforts decided to partner with local authorities in Sichuan, Wang said.

Non-government organizations chose to team up with the government as they lacked the ability to undertake reconstruction work by themselves and were also short on manpower, he said.

“The Ministry of Civil Affairs had initially decided not to collect donations, but then it had to change its stance after a week as a lot of donations were coming through banks,” Wang said.

“We received 90,000 anonymous donations. I ordered our staff to try every method to trace the donors and issue receipts,” he said. “But we could issue no more than 20,000 receipts.”

More than 200 civil affairs ministry staff was involved in arranging transport of relief goods to Wenchuan, the epicenter of the Sichuan quake, day and night.

The ministry transferred all financial donations to the Ministry of Finance by 6 pm every day without keeping a cent, according to Wang.

Stringent procedures

Whenever government departments needed to use the relief funds, they had to go through strict application procedures with the finance ministry, the former official said.

The comments came after a mainland media outlet published a story recently calling into question the handling of the Sichuan donation funds.

Caijing reported on its website that donations related to the Sichuan quake amounted to 76.2 billion yuan in total, with 65.2 billion yuan coming in the form of cash donations and 11 billion yuan in the form of relief goods.

Of the cash donations, there was no clarity on usage of as much as 77 percent of the funds, it said.

The report also suggested that up to 80 percent of the donations went into government budgets.

The report was removed from the website shortly after publication and government authorities also launched efforts to prevent cached versions from being shared on the Web.

Wang said the report was removed as it was found erroneous. 

“Had the reporter given me a call, I could have given him some suggestions and helped him get accurate data,” he said.

Wang insisted that all the funds were handled in a proper manner.

However, he admitted that the government may have to communicate more with the public to dispel any doubts that people might have on the use of the quake relief money.

Besides, semi-official organizations, such as the Red Cross Society of China (RCSC), should hire independent institutions to audit their accounts and improve public confidence, he said.

In 2011, a woman named Guo Meimei (郭美美), who claimed to be the head of RCSC’s commercial unit, sparked a controversy after pictures surfaced online pointing to her extravagant lifestyle.

The photos led to suspicions that some of the RCSC funds might have been misused by the staff. Guo was arrested in 2014 for operating an illegal gambling business and a high-class sex syndicate.

It then came to light that Guo wasn’t an executive of RCSC as she claimed, but by then the charity organization had already suffered serious damage to its reputation.

Bill Gates meeting

Wang, who is the president of China Global Philanthropy Institute (CGPI), visited Hong Kong last week to attend the Asian Venture Philanthropy Network and to meet officials from social enterprises here.

CGPI was established last November by a group of individuals that included Microsoft founder Bill Gates, Bridgewater Associates founder Ray Dalio, China Mengniu Dairy Group (02319.HK) founder Niu Gensheng (牛根生), Beijing Orient Landscape founder and chairman He Qiaonv (何巧女) and Zhejiang Dunhe Investment chairman Ye Qingjun (葉慶均).

In 2010, Gates, together with other 50 billionaires including Warren Buffett, held a charity dinner in Beijing.

After the event, Gates was interested in knowing more about China’s charity policy, which led to a meeting with Wang, who was then the head of Welfare and Charity Promotion Division in the Ministry of Civil Affairs.

Gates later introduced Wang to Dalio, who wanted to push forward the charity sector in China.

Wang said it is a good thing that Chinese philanthropists are partnering with Gates, as the US billionaire has a global vision and network.

“A lot of Chinese enterprises have invested in Europe, America and Africa. Now, Chinese philanthropists should also go there,” he says.

Wang, who left the government in 2010, hopes to contribute to the development of a robust civil society in China using his experience and contacts.

He notes that mainland Chinese society has spent 11 years to form a consensus about the country’s charity sector since the first China Charity Annual Meeting was held in 2005.

The former official said he hopes the China Charity Law, which was passed by the National People’s Congress in March, will help charity organizations in the country become professional.

In other comments, Wang said the mainland’s social enterprises can learn from their counterparts in Hong Kong and Taiwan, especially in the elderly and youth care sectors.

[Chinese version中文版]

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Chief reporter at EJ Insight

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