On July 20th, 2005, Scheme for Reform of the Postal Service System was discussed and approved in the Executive Meetings of the State Council. According to the Scheme, the main contents of postal reform is "one separation, two reforms, and four improvements": separate the administrative role from postal business functions, restructure postal supervision institutions, and set up China Post Group Corporation; reform main postal business and postal savings; and improve the universal service mechanism, special service mechanism, safety guarantee mechanism and pricing mechanism.

As a matter of fact, since 1998, China Post never stopped investigating on and striving for the reform of internal operation mechanism and overall postal management system. Particularly, according to the Scheme for Reform of the Postal Service System issued by the State Council and the "Scheme of Prescribing Institutional Setup, Major Responsibilities, and Personnel Establishment" for postal supervision institutions, China Post pushed forward the reform of separating the administrative role from postal business functions as well as focusing on the development since this year, and has already obtained periodical achievements. There have been 31 provinces, regions and municipalities declared the establishment of postal supervision institutions, marking the crucial step of separating government functions from postal management.

Meantime, after carefully reviewing the successful experiences of deepening internal reform and mechanism innovation in recent two years, China Post continues to reinforce the reform and adjustment of internal operation mechanism, laying the basis for the fast-construction of modern enterprise system and canonical corporate governance structure, as well as the realization of corporate operation.

Accelerate the separation of main and auxiliary parts

After two years' practice, by pressing ahead the operating system reform of services like Express service, and the innovation of marketing, stimulation, and employment mechanism based on the specialization operation, China Post has got a favorable outcome, which remarkably promoted business development.

On July 1st, China Post started the reform of express distribution process, which adjusted and optimized express distribution process, simplify the procedures of mail processing, accelerated mail delivery speed, and improved the production efficiency of network delivery. This is the first comprehensive and systematic reform on express network and production process since postal express service was launched.

The reform of national press retailing system has obtained initial achievements. In provinces, regions and municipalities such as Beijing, Shanxi, Inner Mongolia, Hubei, Hunan, and Jiangxi, an operating system named "combining province and municipality into one" has come true and has promoted the development of press retailing. At the same time, the accounting of gain and loss for professions allowing competition was actively forged ahead, which created conditions for overall product costing and promoted the transition of professional operation mechanism.

The separation of main and auxiliary parts is an important part of postal system reform. Through the efforts in previous period, there has been periodic harvest. In late March 2006, Ministry of Finance, Ministry of Labor and Social Security approved The General Scheme of China Post's Separation of Main and Auxiliary Part, Auxiliary Part Reform, and Redundant Personnel Reassignment and Arrangement. This is an important guiding document for the separation of main and auxiliary part and auxiliary part reform, indicating that the separation of postal main and auxiliary part has turned from the scheme enacting period to comprehensive implementation period, which therefore creates favorable conditions for the next phase of work. At present, State Post Bureau has signed an agreement with agencies, and is planning to complete the job in 2008.

Take a crucial step to separate the administrative role from postal business functions

On August 19th last year, the State Council formally issued Scheme for Reform of the Postal Service System, meaning that China's postal reform has come into the implementation phase. State Post Bureau is pro-actively preparing for the separation of the administrative role from postal business functions following the principal of "active and steady" made by State Council: Firstly, set up provincial, regional and municipal post management bureaus, and fulfill the government regulation functions; Then steadily press ahead the deepening and overall implementation of postal reform. After a year's preparation, till the end of August 2006, the preparation work of all provinces, regions, and municipalities have almost been finished, and the post-construction preparation of national post supervision institution has also been done. The organization structure and post allocation scheme of new national post bureau has been worked out.

According to Scheme for Reform of the Postal Service System, the main responsibilities of newly built provincial supervision institutions are: implement national laws and regulations, policies and postal service standards with respect to post management; supervise local post market, organize and coordinate local universal post services and special services such as confidential communications, private communications, party organ publication, and blind literature delivery, etc.

On September 4th, five provinces and municipalities like Tianjin, Zhejiang, Shandong, Sichuan and Shaanxi, declared the establishment of post management bureaus, giving a start to the separation of administrative role from postal function. Later, local post supervision institutions were successively built. Up to September 17th, all the 31 provinces, regions, municipalities have set up post supervision institutions, progressing a solid step for separating government functions from enterprise behaviors.

At the mean time, the organization and job placement of China Post Group Corporation has been preliminarily determined. State Post Bureau is embarking on the preparation work of setting up China Post Group Corporation and a postal savings bank.

Editor: Yan