Group 1: Narrow Income - National general public budget revenue grew by 0.3% year-on-year from January to August 2025, with August's growth at 2%, down from 2.6% in July [1][4] - The decline in PPI has eased the drag on tax revenue, and the securities transaction stamp duty has provided significant support to tax revenue [1][4] - Corporate income tax revenue saw a substantial rebound, mainly due to a low base last year, while personal income tax and consumption tax revenue growth slowed [1][6] Group 2: Narrow Expenditure - National general public budget expenditure increased by 3.1% year-on-year from January to August 2025, with August's growth at 0.8%, down from 3% in July [1][8] - Expenditure in the social welfare sector continued to grow significantly, while infrastructure spending remained low [1][10] - Central government expenditure grew by 8.0%, significantly higher than local government expenditure growth of 2.3% [1][8] Group 3: Government Fund - National government fund budget revenue decreased by 1.4% year-on-year from January to August 2025, with a notable decline in land use rights transfer revenue [2][13] - Government fund budget expenditure grew by 30.0% year-on-year, driven by accelerated bond issuance by various levels of government [2][13] - The implementation of policy financial tools is expected to support domestic demand expansion [2][13]

Core Viewpoint - Shandong Province is implementing a zero-based budgeting reform to enhance fiscal resource allocation efficiency and strategic support capabilities, transitioning from a "money first" approach to a "planning first" approach [2][8]. Group 1: Key Tasks and Framework - The reform plan outlines 16 key tasks, with the first being the complete cancellation of expenditure baselines, requiring all budget expenditures to be prepared from a zero base [3]. - The zero-based budgeting approach emphasizes starting from zero, meaning that the next year's budget will not be influenced by previous years but will be determined based on the importance of projects [3][5]. - A clear list management system for provincial fiscal expenditures will be implemented, consolidating similar expenditures into unified lists and ensuring that essential expenditures are prioritized [4]. Group 2: Performance and Evaluation - The zero-based budgeting reform is not merely about cutting expenditures but optimizing resource allocation by evaluating the necessity of ongoing projects and eliminating ineffective spending [5][6]. - A performance management system will be established to create a closed-loop system of budget preparation, execution monitoring, performance evaluation, and result application [6][7]. - Departments will be required to submit performance management results alongside their budget proposals, with poorly performing projects facing budget cuts [7]. Group 3: Implementation Challenges - The transition to zero-based budgeting requires breaking away from traditional budgeting mindsets and may encounter resistance due to the need for inter-departmental coordination and fund redistribution [8]. - The reform will increase the workload as all expenditure projects must be re-evaluated annually, necessitating robust data support and analysis for performance evaluation [8].