We were engaged in revolution during the earlier period. As of last year, when we basically completed the socialist transformation of agriculture, handicrafts and capitalist industry and commerce, we fulfilled our revolutionary tasks by and large. What are our future tasks? Besides just a few tasks left over from the revolution, the chief task for the future is building up the country. The task set forth at the Eighth National Congress of our Party was to bring into play all positive factors and all possible forces in striving to make our country a great industrial socialist country. This will be our task for a very long time to come. No one knows how long it will take us to accomplish the task. Building up China will be, if not more difficult, at least as difficult as making revolution, with which we became very familiar. As far as development is concerned, our entire Party is still learning, with a great deal we still do not know. No one would say we were not capable of making revolution, now that we have succeeded in it. But we are not sure how well we will do at building up the country.

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November 17, 1956

Some of our friends have raised the following questions: What do the Chinese Communist Party members mean to do? Who decides which of the classic international principles of communism are applicable to China?

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Comrades,

More than eleven years have passed since the Seventh National Congress of our Party was held in April 1945. During this period tremendous changes have taken place in both our country and our Party. In a little over three years our Party, led by the Central Committee with Comrade Mao Zedong at the head and rallying the people of the country, defeated Chiang Kai-shek's army of several million men, overthrew the rule of imperialism, feudalism and bureaucrat-capitalism, and established the People's Republic of China. Following the nationwide victory in the revolution, the Party and the People's Government, again in no more than three years, completed the rehabilitation of our national economy and carried out a series of democratic reforms. From 1953 on, the Party and the People's Government have been engaged in the construction programme mapped out in the First Five-Year Plan and have achieved decisive victories in socialist transformation. This succession of magnificent victories furnishes indisputable proof of the correctness of the political line laid down by the Party's Central Committee since the Seventh Congress. It is also indisputable proof of the correctness of the organizational line laid down by the Seventh Congress and of the organizational leadership of the central Committee in the same period. Comrade Liu Shaoqi has already made a detailed report on the various aspects of the work done by the Party during this period and the tasks that now confront it. The Central Committee has entrusted me to make the following report concerning the revisions to our Party Constitution necessitated by the changes that have taken place in the Party.

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July 9, 1954

Now that we are engaged in construction programme, cadres have become a decisive factor. The situation with regard to our cadres is: on the one hand, we do not have enough of them and, on the other, we are not making the best use of those we have. So, we should take full advantage of the cadres we have and at the same time train large numbers of personnel for the various fields of our construction programme. Leaders in many departments of the Government Administration Council are paying close attention to production and capital construction, which is the right thing to do, but they are not paying enough attention to the training of cadres, as can be seen from the little attention they have paid to the schools they run. They barely seem to realize that running schools well and training cadres are the fundamental of our construction programme. At present, some departments have staffs of several hundred thousand and dozens of schools, but instead of trying to run these schools well, they always pin their hopes on people transferred from other departments. They should mainly depend on cadres trained in their own schools. Our secondary technical schools generally are a failure, except a few that are truly well run. We must find a way to solve this problem. Administrative personnel in some departments fell they are highly valued if they are asked to take charge of production and feel they are being demoted if asked to run schools. This is an unhealthy tendency which represents the chief obstacle to successful management of schools and must be overcome.

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February 6, 1954

I fully agree with Comrade Liu Shaoqi's report, which appropriately appraised the work done by the Political Bureau of the Central Committee since the Third Plenary Session of the Seventh Central Committee,156 I also fully agree with the "Resolution on Strengthening Party Unity",157 drafted at the suggestion of Comrade Mao Zedong and submitted to the session for discussion, and with the clear and elaborate explanations of the draft resolution made by Comrade Liu Shaoqi.

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This conference has been a success and achieved the desired results. This is because all participants have taken the overall situation into consideration and proceeded from the facts. Neither of these two approaches is dispensable. It is precisely because the Ministry of Finance did not follow these approaches in the past that problems have cropped up in its work, bringing numerous complaints from all departments.

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I shall now discuss the six principles for future financial work.

First, the budget should be made by central departments. Why? Because our budgets of the past few years, particularly the one of 1953, contained risky provisions. The greatest risk lies in that the Ministry of Finance makes policy decisions for all departments, which shows ignorance of the fact that policies are embodied in figures and that to decide on figures is to make polices. Having central departments prepare the budget is a matter of policy. The amounts allocated indicate the importance and urgency of projects, as well as which projects should be undertaken and which should not, and therefore this is a political question. When the Ministry of Finance makes decisions for the departments, some people say it ``has the money but no policy for spending it''. It dose have a ``policy'', but it is not the correct one. In the past the Ministry of Finance exercised too much control over departments, only to elicit complaints for the following two reasons. One, as it drew up the budget behind closed doors, it was criticized right and left whether it allocated funds to the departments or not. Two, as the budget was not worked out by central departments, the ministry was not in a position to exercise effective control while trying to have a finger in every pie, thus becoming the main target of attack. If the budget is prepared by central departments, it will be easy to control and decide on it. Therefore, all projects must be covered by budgets that are worked out by central departments. However, this does not mean the Ministry of Finance will have nothing to do with budgeting; it still has the right to intervene and offer suggestions. When offering suggestions, the ministry takes the overall situation into account, making sure that the state can afford the expenditures allocated and that they conform to the growth rate of the national economy. A budget cannot be decided on by a department itself; the department has to consult with other departments concerned. Departments at all levels are in favour of the principle of having the central departments preparing the budgets. There are no central departments to be responsible for the preparation of some of the budgets. Once there are, things will be easier.

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The struggle in southwest China was most acute in March and April. The return of security money and the punishment of law-breaking landlords in rural areas as well as the three great movements -- embarking on the first phase of agrarian reform, suppressing counter-revolutionaries and resisting U.S. aggression and aiding Korea -- reached a climax. In the second half of March, the Southwest Bureau of the Central Committee held a meeting on united front work and, in the second half of April, held the second meeting on urban work. I shall not dwell on those two meetings, since we have submitted separate summary reports on them.

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The Central Committee of the Party and Chairman Mao have pointed out time and again and made it very clear that united front work should be improved. Our victory in the revolution is inseparable from the united front work we did. Without the united front we could not have fought battles so successfully; even though we may be victorious, we still cannot do our work well without it. However, not all our cadres realize its importance. That is why the Central Committee and Chairman Mao have once again brought up this matter and the Central Committee has issued a special directive on it. In accordance with this directive, we are holding this conference on united front work. The requirements in the Central Committee's directive are quite specific, so there is no need for me to dwell on them. Today I shall mainly discuss problems concerning erroneous ideas.

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