Welfare heating to be stopped in 2007
By Zhu Zhe (China Daily)
Updated: 2005-12-19 05:23

Urban residents in northern China will have to pay for their cozy winter living by the end of 2007.

A notice issued on Saturday by the Ministry of Construction and seven other ministries urged a commercialized heating system within two years.

Smoke rises out of a chimney in a residential area in Beijing in this February 11, 2005 file photo. China will reform its welfare heating system and residents will have to pay to keep warm in the cold winter. [newsphoto]

Regarded as a public welfare service, heating has been free for urban residents who work in State-owned enterprises or governmental organizations in northern China since the 1950s.

But the notice said no work units should help pay the heating fees for their employees, and householders should pay the fee directly to heating companies.

"The reform will help solve accumulated problems under the old system, such as energy waste, outdated equipment and delay of fee payment," said Chen Wenzhan, head of the Beijing Municipal Administration Commission.

"But it will be difficult as well. A large sum of money will be needed to install measurement equipment in homes as heating will be measured individually."

According to China Electric Power News, more than 90 per cent of thermal-power plants in China are bearing huge losses every year.

Water prices have risen by 30 per cent in the past five years, and the price of coal has reached more than 200 yuan (US$25) a ton this year, three times as much as in 2001. But the price of heating supply remains unchanged, the report said.

As part of the reform, the notice stated that heating supply would be a commodity priced by the market. Local governments are allowed to adjust the heating price if prices of raw materials change by more than 10 per cent.

The notice also said local governments and individual work units should provide financial subsidies to residents, especially to low-income households.

Currently, the heating season lasts from November 15 to March 15 in Beijing, and the price for each square-metre is 24 yuan (US$3) every season, according to the Beijing Heating Group.

But low-income households still find it tough to afford. "We will have to pay 1,700 yuan (US$ 210) for the heating of a 70 square-metre flat under the new system," said 45-year-old laid-off worker Jiang Yongfu in Beijing. "That's almost triple my monthly income."

Jiang said he supports the reform because "commercialization is inevitable," but he added that subsidies should be given and an instalment plan be introduced.

The plan for China's heating system reform was drafted at the end of 2003, and has been tested in certain parts of Northeast China.

(China Daily 12/19/2005 page2)