Practical Experience and Recommendations for Increasing Rural Residents' Property Income

In recent years, with the implementation of various national policies to strengthen, benefit and enrich agriculture, farmers' income has maintained a relatively rapid growth momentum. How to ensure sustainable growth of farmers' income and further narrow the urban-rural income gap has become one of the issues of great concern to all sectors of society. The Third Plenary Session of the 18th Central Committee of the Communist Party of China proposed to “explore channels for farmers to increase property income”. At present, there is a large amount of “sleeping capital” in rural areas, and the potential for growth in rural residents' property income in the future is enormous. Pioneer regions such as Dongguan in Guangdong and Chongqing have made many attempts to increase rural residents' property income and accumulated valuable experience, which helps to explore and improve China's policies for increasing rural residents' property income from a practical perspective.

I. Dongguan: Experience of High-Proportion Property Income Growth under Export-Oriented Economic Conditions

Dongguan City is located in the Pearl River Delta region and is a typical representative of China's “export-oriented economy” model. According to preliminary calculations, in 2012 the per capita net income of rural residents in Dongguan City for the whole year was 24,900 yuan, ranking first in the country, a year-on-year increase of 9.2%, 0.5 percentage points higher than the growth rate of per capita disposable income of urban residents, exceeding the growth rate of per capita disposable income of urban residents for 3 consecutive years. The ratio of per capita income of urban and rural residents fell from 1.77:1 in 2006 to 1.72:1 in 2012, and property income of rural residents accounted for more than 25%, which was mainly due to the rapid development of the rural collective economy driven by rapid industrialization.

(1) Practices and Results in Promoting the Development of the Rural Collective Economy

The Dongguan municipal government encourages local rural residents to transfer to non-agricultural industries and has taken multiple measures to support the development of the rural collective economy. First, implement organizational guarantees and support policies. Dongguan City established the Rural Collective Asset Management Office in 1998 to guide the assessment, definition and transaction of rural collective assets, formulate rural collective asset and financial management systems, and supervise the disclosure of rural collective finances. It issued incentive policies for towns and villages in attracting investment, large village manufacturing taxpayers and taxes on key village projects, and set up a special subsidy and reward fund of 100 million yuan for industrial upgrading of towns and villages to promote the upgrading of collective property. Second, innovate the development model of the rural collective economy. Support towns and villages in using land, property, funds, etc., through trusts, cooperation, equity participation, investment funds and other forms, to participate in urban development, industrial investment and infrastructure construction. Promote coordinated development models such as coordinated investment attraction by city, town and village, coordinated land use, cooperative development, and three-level profit sharing, support towns and villages in building collective property projects in a coordinated manner through the form of “unified planning, unified construction, unified operation, independent property rights, and returns to the village”, and encourage qualified collective economic organizations to implement corporatized transformation. Third, reform the system and mechanism of the rural collective economy. Promote the “three separations” of village-level government affairs, autonomous affairs and the collective economy, establish a rural collective asset trading platform, implement the “Implementation Plan for the Reform of the Rural Shareholding Cooperative System in Dongguan City” (2004-2006), and explore the transfer of collective equity. Fourth, standardize collective asset management. Establish a four-level network supervision system at the city, town, village and group levels, implement tiered management of debt risks by town and street governments, establish debt ledgers for villages and groups, carry out asset verification and capital verification for villages and groups, strictly control welfare expenditures, and improve the profit distribution system for collective asset operations.

Under the favorable situation of the rapid development of the rural collective economy, farmers in Dongguan City further obtain substantial property income by building factories for rent, collecting housing rent and making asset investments. By the end of 2012, the total assets of the two-level collectives of villages and groups in Dongguan City were 126.31 billion yuan, an increase of 11.3% over 2008, accounting for 1/3 of the total assets of collectives at the same level in Guangdong Province, and the number of villages with two-level net assets of villages and groups exceeding 100 million yuan reached 302. The developed collective economy of Dongguan City also made the per capita property income of rural residents and its proportion far higher than other regions in the country, with the absolute amount and proportion rising from 4,171 yuan and 23.6% in 2006 to 7,232 yuan and close to 30% in 2011. A survey of Yantian Village, Fenggang Town, Dongguan City found that in 2007 the per capita income of the whole village reached 61,000 yuan, and income from the collective economy accounted for 31.65%, which is clearly different from the income structure of rural residents in other developed areas, where wage income is the main source. The main source of farmers' household income in Yantian Village was property income, accounting for as much as 60.86%, 32.18 percentage points higher than wage income, which ranked second in proportion. Among these, collective economic dividends were one of the most important sources of property income, which verifies the good results of Dongguan City's policies to promote the development of the rural collective economy.

(2) Characteristics and Defects of the Growth Model of Rural Residents' Property Income

The high proportion of property income in rural resident households in Dongguan City mainly relies on the developed export-oriented economy of the Pearl River Delta region. With the rapid development of the rural collective economy, many rural areas have already achieved industrialization, can attract large numbers of migrant workers, and facilitate the development of the property economy in rural areas and farmers' self-employment. Rural residents' property can generate property income nearby. To a certain extent, the existing land system has a relatively small restrictive effect on it. Factors such as land and housing do not need to enter the urban trading market, and high returns can be obtained only within rural areas.

Obviously, this model of property income growth is only applicable to rural areas with highly developed non-agricultural economies. The problem of property income growth faced by local farmers has changed from how to activate the potential of rural property to how to obtain higher returns on the basis of existing property. However, the survey of Yantian Village shows that the income level of rural residents is not obviously related to their education level, their financial concepts and financial practices are backward, and they rely too much on the export-oriented economy. Not only are the channels for property appreciation limited, but they are also vulnerable to uncertain factors such as fluctuations in the international trade environment, industrial upgrading in the Pearl River Delta and industrial transfer. The sustainability of the growth of farmers' property income still faces many challenges.

II. Chongqing: Experience of Property Income Growth in a Late-Developing Region under Rural Property Rights Reform

Chongqing City is the only municipality directly under the Central Government in the western region and has the typical urban-rural dual structure characteristics of a “large city, large countryside”. In 2007, Chongqing City was designated by the State Council as a national pilot zone for comprehensive coordinated urban-rural reform, laying the foundation for faster growth of rural residents' property income in Chongqing. For a long time, the property income of rural residents in Chongqing City has been fluctuating. After the coordinated urban-rural reform in 2007, rural residents' property income began to enter a sustained upward channel. From 2007 to 2012, the average annual real growth rate of property income reached 23.8%; in 2012, the per capita property income of rural residents in Chongqing City was 175.56 yuan, an increase of 25.7%, the fastest growth among all sources of income. In recent years, the continuous and rapid rise in rural residents' property income in Chongqing City has preliminarily verified the effectiveness of the reform of the rural property rights system.

(1) Main Practices and Effects in Promoting the Growth of Farmers' Property Income

1. Establish a rural property rights trading platform and innovate various forms of property rights transfer models such as land tickets

At the end of 2008, Chongqing City established the Rural Land Exchange, which is mainly responsible for handling the centralized transfer and trading of farmers' land “physical” asset rights and land quota asset rights, including contracted management rights of cultivated land, forest land use rights or contracting rights, farmers' homestead use rights, rural collective construction land use rights, and the transfer of use rights or contracted management rights of rural unused land. At the same time, the land exchange also innovatively explored the land ticket trading system, that is, using the method of linking increases and decreases in urban and rural construction land to reclaim idle rural homesteads and other land as cultivated land, thereby generating construction land quotas, and conducting public transactions with society through the Rural Land Exchange. Rural land transfer transactions, especially land ticket transactions, have realized large-scale, long-distance land replacement within the municipality, enhanced the value of rural homesteads in remote suburban counties, become the main source of funds for farmers' new housing construction, and increased farmers' property income. In addition, farmers can also obtain collective economic dividends from land ticket transactions of collective economic organizations.