Recently, financial data for the first three quarters of this year have been successively released by the provinces in China. Issues such as delayed salary payments, stalled projects, and public transport services being suspended have been frequently mentioned in documents and announcements across several provinces. Some local governments have specifically listed out salaries, livelihood issues, and basic operations separately, with word-of-mouth spreading the information rapidly and even circulating in social media circles.
As of November 17th, according to a list compiled by First Financial, except for Guangdong, Xinjiang, and Heilongjiang, the remaining 28 provinces have all disclosed their financial data for the first three quarters of this year. Looking at the data from these provinces, Tibet and Jilin have seen double-digit growth rates in budget revenue, while most other provinces are around 2%, with some showing negative growth.
However, public opinion believes that official data contains significant discrepancies. In an interview, a scholar mentioned, “A friend of mine in the Shandong Province government said that this year’s financial data is abysmal. The data being reported is not reflective of the actual situation. Just look around on the streets and in restaurants, how many people are spending money? Some grassroots governments can’t even pay their employees’ salaries.”
Before the end of the year, various information regarding salary arrears, halting of projects, suspensions of services, and adjustments in healthcare have been prominently emerging on social platforms. Many comments have highlighted that public services in local areas are being cut back faster than usual. During interviews, it was revealed that some counties have postponed payment of salaries based on the new budget arrangements, leading to disruptions at the grassroots level. Countless civil servants and non-staff members in Hubei, Yunnan, and Heilongjiang have mentioned that their income in the second half of the year has noticeably decreased.
Mr. Shi, an employee in Xiangyang, Hubei, mentioned that currently, only basic salaries are being paid, and performance-based pay is being calculated quarterly. He shared about a friend in Luotian County where salaries have not been paid for half a year, leaving everyone waiting for updates with a sense of helplessness.
Mr. Shi noted that there have been internal warnings about declining government revenue and the need to wait for centralized arrangements from higher authorities. Bonuses have been deferred to the next quarter, yet the exact timing of payment remains uncertain.
In a chat group in Hubei, a netizen expressed that salary arrears are primarily happening in counties and townships, with some places failing to meet even the basic wage standards. They mentioned that various projects in counties were being repeatedly delayed, resulting in unpaid wages.
In October, construction on urban projects in Zhaotong, Yunnan, came to a halt. Mr. Jiang, a local project contractor, mentioned that a notice was put up at his construction site stating “awaiting further funding arrangements.” He explained that the release of project funds depended on future allocations, creating uncertainties regarding material costs and workers’ wages. Some workers even wished to return home early, requiring management to coordinate the situation internally.
Another individual familiar with local project conditions mentioned that such occurrences were not isolated incidents, citing similar situations throughout the autumn this year. The prevailing fear was the uncertainty of receiving payments before the year ends.
On September 29th, three public transport companies in Lipu, Guangxi, posted notices of service suspension, citing insufficient funds, long-standing losses, and inability to cover insurance costs. Similarly, in Anyang, Henan, some suburban routes faced suspensions. The Anyang Public Transport Company attributed this to a decrease in passenger flow post-pandemic, resulting in route losses and stressed drivers, rendering resumption impossible.
Comments on social media platform Douyin highlighted the struggles faced by commuters due to halted public transportation services, pushing individuals to rely on carpooling for daily commutes between villages and towns. The sentiment echoed in the comments emphasized the financial impact of reduced passenger flow on service revenue.
An expert focusing on urban and rural transport mentioned that public bus services heavily relied on subsidies to operate, citing continuous decline in passenger flow over the years, placing stress on many routes.
The healthcare system has also begun to contract its services. A video uploaded by a netizen mentioned the suspension of services at the West Campus of Zhengzhou University First Affiliated Hospital on a Wednesday night, sparking discussions and speculation about the reasons behind the sudden decision. The ensuing comments section was flooded with discussions and conjectures based on the video content.
An announcement from Zhengzhou University First Affiliated Hospital mentioned the suspension of services at the medical extension points in Zhutun Road and Huafiedong Road starting from November 20th.
Many hospitals have recently announced adjustments in their service areas. As per a report on November 18th, the Shanxi Tumor Hospital would withdraw from the South Campus of Jiangbei International Hospital Phase II by August 2025; Chaoyang Rehabilitation Hospital declared the consolidation of “one hospital with two districts” into a single unit in September; and Wenzhou Medical University Affiliated Tumor Hospital disclosed a downsizing plan for the updated Rui’an New Campus, significantly reducing bed space and area.
In the comments section, numerous individuals noted the recurring news of hospital mergers and downsizing, with patients expressing concerns about longer waiting times post-consolidation.
A scholar specializing in healthcare systems mentioned that post the second half of this year, many regions had begun reorganizing medical resources and adjusting hospital areas and specialty departments. He emphasized that as public hospitals adopt new evaluation criteria, non-tax revenues have been channeled into medical insurance funds, thereby shrinking the revenue opportunities at the hospital level.
A report by People’s Daily on September 28th stated that many local finance departments highlighted slow growth in general public budget revenue, citing greater pressure to safeguard the three guarantees (ensuring basic livelihood, salaries, and operation). Local financial authorities were quoted saying that priorities should be given to salaries, livelihood security, and essential operations.
Reacting to the situation, individuals in the comments section expressed concerns about the frequent occurrences of issues related to the “three guarantees”. Suggestions were made to reduce administrative projects, with focus on realigning project funds and departmental budgets.
A report by Xinhua News Agency on October 12th indicated a widening disparity between eastern and western regions, leading some county areas to adjust administrative costs, suspend non-essential projects, and procurement. The report mentioned that special employment and medical arrangements were to be made for key population groups.
From the publicly available data, it is evident that there has been a significant decrease in land revenue this year, with fewer land auction announcements and an increase in unsold land parcels. Local governments have highlighted the need to restructure expenditure and re-prioritize project sequencing as reflected in county-level financial reports citing “prominent revenue-expenditure contradictions.”
An individual knowledgeable about local finance mentioned that the immediate reduction in land revenue directly impacted county-level income, leading to the postponement of several projects and uncertainty regarding year-end fund allocations.
Mr. Li, a civil servant in Nanchong, Sichuan, emphasized the importance of ensuring salaries, livelihoods, and daily operations by the year-end. He mentioned that recent tax audits and reviews pointed towards financial stress, with a looming urgency to address the arising challenges. Mr. Li disclosed that he was nearing retirement towards the year-end.
A female teacher in Shangrao, Jiangxi, remarked on the division of performance-based pay into quarterly or bi-annual calculations this year. She questioned the purchasing power in such a scenario, noting a decline in consumer activity with several local stores shutting down due to lack of business.
Many netizens shared their experiences of decreasing income leading to an increase in shop closures and rental terminations, calling attention to the repeated calls from local authorities to boost consumption without addressing the root cause of diminished consumer spending power.
A report by Economic Daily on October 20th highlighted the sustained low-speed growth in local fiscal revenues, prompting cities and counties to postpone non-essential projects while increasing centralized allocations to maintain basic functions. CGTN News on November 2nd reported that some county areas had temporarily halted administrative projects, delayed procurements, and reduced public expenditure to maintain fiscal balance.
Huang Zhong, a media personality specializing in local finance, commented that issues such as salary arrears, halted projects, service suspensions, and healthcare adjustments have been witnessed across multiple provinces this year. He emphasized that with the decline in land revenue, many localities have relied on transfer payments and central funds for support. County-level governments are now tasked with balancing financial solvency and labor mobility. He mentioned that the frequently referenced “protecting the bottom line” in public data indicates the current direction of local authorities.