SGAS official on 'employing COC fund'

Bearing in mind the questions raised by domestic and overseas readers in their letters and cables regarding"employment of the fund of the Chinese Olympic Committee (COC)", this reporter Zheng Hongshen of People's Daily (Overseas Edition) recently had an interview with the State General Administration of Sports (SGAS).

An official with the Administration said,"The State General Administration of Sports and the Chinese Olympic Committee express thanks to the State Auditing Administration for its conscientious and responsible auditing, and welcome questions from the media and the people, because that means good care and an alarm to us, we will strive to make rectification and improvement. However, the report by some media is at variance with the information about the 'SGAS drawing upon fund of the Chinese Olympic Committee', and there is a considerable discrepancy." The official was asked to give explanations on some questions.

Question: Some media report says that the State General Administration of Sports draws upon the special fund of the Beijing Organizing Committee for the 2008 Olympic Games (BOCOG), is that true?

Answer: The report is inconsistent with facts. The BOCOG and the COC have made representations to the relevant media, the media has made an open correction, admitted its mistake and expressed its apology.

Some media, unaware of the situation, even upgraded the"SGAS employing the COC fund" "as"misappropriating" or"embezzling" the fund, and has thus triggered a chain reaction from domestic and foreign media and entailed increasing formulations of confused conceptions. In order to avoid negative effects on China's preparation for and participation in Athens Olympics and preparatory work for the 2008 Olympics Games, we deem it necessary to realistically make some explanations.

Q: Our newspaper has also received letters from overseas readers, in which they ask whether social donations are drawn upon.

A: This is also sheer misunderstanding or rumor. Here it is necessary to clarify one conception, the income from enterprises' donations as included in the account of the Chinese Olympic Committee is commercial by nature and an act of market development, this is a common international practice and is different from"social donations" which require no repayment. Anyone unfamiliar with the detailed story is apt to lump the two together as"social assistance". There is no social donation money in the account of the Chinese Olympic Committee. The State General Administration of Sport pays high attention to social donations and places such donations under the unified management of its affiliate, the All-China Sports Fund, management is exercised strictly in accordance with related State stipulations. So, there is no such thing as the sport administration or the Chinese Olympic Committee recklessly employing social donations.

Q: Is it that the sport administration has drawn upon the money allocated for building sports facilities, for the training of athletes and for competitions?

A: That's something impossible. The special fund for building sports facilities and the operating expenses for the training of athletes and coaches and for competitions in the Olympic and Asian games are allotted by the Ministry of Finance directly to the sports administration, the functional department of the sports administration manages and uses the fund and expenses (including income from the distribution of lottery public welfare fund) strictly in accordance with State stipulations. No such money has ever been misappropriated.

The fund included in the account of the Chinese Olympic Committee is not the special fund allotted by the State, but instead it is mainly the income derived from the market development carried out by the committee itself as well as income from the dividends derived from participation in the market development of the International Olympic Committee (IOC). Besides, there are the funds granted to us by some international organizations for special conferences and activities, these funds are all used according to the requirements and stipulations set by international organizations and have never been diverted to other purposes.

Q: Is the State General Administration of Sports, as a governmental department, allowed to employ the fund from the market development carried out by the Chinese Olympic Committee as a public organization?

A: As is well known that China's current sports management system is very special in that the Chinese Olympic Committee is still not an independent entity, and does not have its separate establishment and full-time personnel. The leading body of the State General Administration of Sports is the same leader group of the said committee. That"the sport administration uses the fund of the committee" is a problem emerged under the special system of"two combined into one", which needs to be rectified.

I want to make it clear here that the income from the Chinese Olympic Committee's market development comes mainly from the development of intangible asset. Olympic Charter requires that the national Olympic committee"seeks sources of revenue that enable it to keep itself independent in all aspects". In this spirit and in line with the requirements of the Statutes of the Chinese Olympic Committee, the Chinese Olympic Committee and various associations of single Olympic sports events should try hard to help athletes, sports teams and delegations to develop intangible assets, such as advertising, the income gained therefrom should be divided up in proportion among the individual, collective and State.

Q: What's the matter about employing the COC funds for building houses for workers and staff members of the sport administration and for subsidies issued to them?

A: Yes, part of the funds accumulated over a long time through market development by the Chinese Olympic Committee are employed as self-raised funds, supplementary funds (109 million yuan, representing one-third of the total funds collected) for building houses for workers and staff members. Among the staff members moved into newly built houses, the overwhelming majority are veteran athletes, veteran coaches and veteran sport workers who have made outstanding contributions to the Olympic Games and to the sports undertaking, and coaches, scientific researchers and association officials currently working on the frontline who have won honor for the country, as well as some others with dual-capacity staff members of the sport administration and the Olympic committee.

Previously, the Chinese Olympic Committee had never issued salary or subsidies to the cadres of the sport administration who had been shouldering all the work of the committee. Beginning from 2002, an appropriate amount of subsidies taken out of the income from the committee's market development was granted to the aforementioned people, this is mainly because of the greatly increased workload on the committee after China's success in bidding for hosting the 2008 Olympic Games, plus the need to fulfill a great deal of work related to the Beijing Games besides the daily work of the committee, as well as a certain amount of ahead-of-time preparatory work. At the outset of its issuance, the allowance was planned for cancellation immediately after the Beijing 2008 Olympics Games.

Concluding, the official expressed his thanks to the media and the people for their concern and supervision, and his hope that the media would avoid making reports inconsistent with facts. The Chinese delegation to the Athens Olympic Games will be formed just in a few days, he expressed the hope that all the Chinese people would concert their efforts to support Chinese sports delegation to the Athens games to win honor for their motherland.

The above interview was carried on the front page of People's Daily (Overseas Edition) on July 6, 2004 and translated by People's Daily Online.