Taipei Times: After the recent special municipality elections, a new form of local political system will emerge. What is your opinion of the conditions and limitations of this new system?
Yeh Jiunn-rong (葉俊榮): When the Republic of China government was still in China, it was organized into provincial, city and county level governments. Some of the city-level governments were special municipalities directly controlled by the central government. After the government moved to Taiwan, these classifications were kept despite the fact that Taiwan was much smaller both in area and population than China. Since the classifications were not changed to fit the new circumstances, local governments were split into two categories: Direct-controlled — Taipei City and Kaohsiung City — and non-direct-controlled. The latter groups were further split into categories of regular cities and counties, of which there were 16, and five provincial municipalities. Money, power and people were all allocated according to this system.
Forty-three percent of the central government’s Tax Redistribution Fund is given to direct-controlled municipalities, while 39 percent is given to the other counties and cities. More power is given to special municipalities, too. In terms of organization, this allows these municipalities to establish more bureaus, have more political appointees and have higher--ranking officials. This results in major discrepancies between different cities and counties.
Photo: Liao Chen-huei, Taipei Times
This also means that more and more cities and counties outside of Taipei want to be upgraded. The main reason behind this is poverty or dissatisfaction with finance, power and personnel. This dissatisfaction is mainly caused by comparisons with Taipei City. Therefore, the difference between special municipalities and other cities and counties is in itself a problem.
There are two ways we could solve this problem.
One way is get rid of special municipalities. There may be some need to have special municipalities in countries with large territories and populations, but there is no need for this in Taiwan. Therefore, it is better if we go back to having the original city/county model.
The other way would be to keep special municipalities. That is the approach we are adopting now. However, we have to get it right. The reason I say this is because since we have now let some areas upgrade, how can we say no to allowing others to upgrade? By keeping the system of special municipalities we will continue to increase the discrepancies between these municipalities and the regular cities and counties. The special municipality elections last Saturday show the polarization between the new special municipalities and the nation’s other cities and counties.
Now that we have held the special municipality elections, and we will have five of them, if other cities and counties are not upgraded in the future, they will have to be merged. However, this makes the whole situation more difficult.
For example, Taitung and Hualien have populations of 270,000 and 340,000 respectively, which combined is still less than the population of Banciao (板橋) at 540,000. However, places like Taitung and Hualien will have to be merged, otherwise they would be at even more of a disadvantage and receive less funding and resources than they do now.
In the future, there will be 15 governments that will still need to be merged and upgraded to make things more fair. When mergers occur, there will be many places left isolated and with no clear direction. For example, what city would Keelung be merged with? Would Yilan be merged with Taipei or Hualien? Regardless of these issues, these cities and counties will have to be merged so that every place can become a special municipality. This would in effect make the whole idea of the special municipality redundant and make more things equal overall. The best situation would involve revising the Local Government Act (地方制度法), changing the name of this act and to stop using the term special municipality altogether.
TT: What challenges will we face once the five special municipalities have begun to operate?
Yeh: Following the elections, we will probably see three kinds of relationships: Between the five special municipalities and the central government; between the five special municipalities themselves; and between the five special municipalities and the other counties and cities.
Relations among the special municipalities could take two directions: A competitive relationship or a cooperative relationship where the five special municipalities unite to counterbalance the central government. Regardless of which of these directions the relationships take, the future is not simple and alliances will form depending on the issue at hand. Whether the special municipalities cooperate with each other or engage in vicious competition, it will be on a grander scale than before because the combined population of the five cities makes up more than half of all of Taiwan. The special municipalities will use a lot of resources and be hugely influential.
Then we have the relationship with the central government. Fiscal concerns will be very serious issues. The Act Governing the Allocation of Government Revenues and Expenditures (財政收支劃分法) was about to be revised, but the revision has not been completed this year.
In several aspects of government revenue and spending, be it tax revenue or expenditures, allocations in the current system reflect the requirements of the special municipalities. If the 43 percent allocated to direct-controlled municipalities is not changed and continues — with the early allocation to Taipei County that has already set off controversy — the only thing that can be done is for the central government to make up the difference, and this will give the government a lot of room for control.
One major problem with local autonomy in Taiwan has been that the central government has always had a tremendous influence over finances. This means that if the allocation act is not revised, it is very possible that the upgrading of the new special municipalities will give the central government even more control. This is not beneficial to promoting balanced local development and could result in a deterioration of the fiscal situation, perhaps even leading to the discrimination of the counties and cities that have not been upgraded to a special municipality. It will also cause the five special municipalities to compete for influence.
In these five special municipalities, a lot of people will be promoted to official posts. For example, city or county government managers or chiefs of first-level institutions, such as bureau chiefs, have normally been appointed using a 12-grade scale. Special municipalities use a 13-grade scale. That means that following the creation of the new special municipalities, the number of institutions and official grades will increase. They will become bigger and human resource expenditures will increase. Taipei County, for example, is all but certain to grow because it was upgraded without a merger. The organization following the creation of the new special municipalities must be effective and this is a major challenge that must be met by the new city governments.
As for power, many laws clearly stipulate which powers pertain to local governments and which don’t. This must all be reviewed to see which controls should be given to the special municipalities. The most complex issue over power that follows this expansion involves influence and effect the creation of the new municipalities will have on relations with other cities and counties.
The conditions vary for each of the new special municipalities. Their collective promotion affects the rapid flattening of the bureaucracy that is currently under way in the capital. Should the five special municipalities take a consistent approach to internal governance issues and the issue of how to spend money? Where should the center of the network system be located? Should there be a secondary center? There are many questions and issues about developmental justice within the cities and the cities will encounter challenges to their governance, but will the local leasers have the full powers necessary to deal with these issues or will they have to continue to listen to the central government? Will all powers be devolved? This is an issue that requires some serious attention.
The final important issue is the matter of legally required expenditures. The proportion of these expenditures differ between special municipalities and ordinary cities and counties. After “growing up” to become a special municipality, these cities have to carry the burden of a bigger economy. In the future, the central government must give renewed consideration to these allocations. Legally stipulated expenditures, such as the national health insurance and the civil servant insurance, will likely have to be reconsidered.
TT: Tainan City and Tainan County already suffer from a serious fiscal deficit. The increased expenditures and the lower subsidies from the central government following the implementation of the new system cannot be effectively solved in the new version of the Act Governing the Allocation of Government Revenues and Expenditures. The fiscal deficits of Greater Tainan are likely to continue to grow. What are your thoughts?
Yeh: There is a general misconception that upgrading [to a special municipality] is a good thing because it will make you comparable to Taipei City. Given the current system, however, it becomes necessary to also look at how many powerful and rich people there are, because upgrading will necessarily lead to increased expenditures. The creation of the new special municipalities will not have the same impact on all five special municipalities and that is true even for legislative issues. That means that given the current system, it becomes necessary to take a detailed look at the conditions of these special municipalities and how much they will be able to get. It is unavoidable that some of the new cities may encounter more problems than the others.
Planning the tax distribution involves the allocation act. If that act can be quickly revised following the elections, there might be new ways to do it. However, this depends on many variables, so it would probably be correct to say that the end of the elections is just the beginning of all the headaches. We are just about to have to start dealing with many daily routine issues. The main thing will be to set up a reasonable system, as that will have the greatest impact.
TT: The future division of administrative regions will be an even bigger problem. How should that be dealt with?
Yeh: Following the Constitutional amendments [to the electoral system] in 2005, there was concern that not every vote would have the same value. For example, more than 400,000 people in Yilan would only be able to elect one legislator, while some counties with only 200,000 residents would also be able to elect one legislator. That means the government must consider this very issue when redrawing the administrative areas so that we get a more reasonable and balanced situation. This will not require a Constitutional amendment; it will just require more detailed adjustments.
In future mergers of cities and counties, is it possible that a county will be divided in two and then individually merged [with other regions]? This would constitute even more complicated strategy, and in theory it would be necessary in order to make sure that every vote has the same value. To successfully realize this ideal will require even more careful and detailed manipulation, and it will require a higher degree of consensus and more compromise than the previous plan. In this process, care must be taken to avoid the impression of favoritism by the central government. This would entail having every party participate in the debate over how to proceed with the revisions.
The [creation of the] new special municipalities is only the half-way mark, not the finish line. Further mergers and upgrades must be handled conscientiously while we at the same time extract ourselves from the restrictions of the special municipality. For example, in future, there will be five mayors of special municipalities at Exectuive Yuan meetings. Will that continue if we have 10 special municipalities? That would be a rare occurrence compared with Cabinets around the world and it highlights the shortcomings of the traditional system. This is something that must be dealt with in future.
We are discussing the division of administrative areas in light of globalization. This is very significant and some values must be highlighted.
First of all, the question of how to highlight the real strength of these metropolises and how that strength can be reflected in Taiwan’s politics, economy, society, culture and even in international connections and marketing is very important.
Second, in the process of globalization, many remote areas, such as Hualien and Taitung, must be transformed into centers instead of continuing to see them as “the back of the mountain.” Changing such concepts takes more than just building a new road to the place. Instead, we should consider how to do this through drawing up good administrative regions that would also allow them to maintain their own cultural characteristics.
Through the process of globalization, we must highlight many different values; strengthening the weak and further strengthening what is already strong. This is why in the future we must still give certain administrative regions special status, such as the offshore islands or the Hualien-Taitung region. These regions could be given a very high, but still different status so that they would not be hurt because they are of a different character. That’s the only way to maintain Taiwan’s characteristic diversity.
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