The premier called on all the departments under the State Council, or the cabinet, governments at all levels and enterprises to draw lessons from the serious problems uncovered by the National Audit Office (NAO) in its auditing of the implementation of the 2003 central budget.

Addressing a national teleconference on national governance according to law, which was held on June 28, Wen said all the persons who violated the laws and regulations must be "dealt with seriously."

The State Council would make a special report on what have been done to settle these problems to the country's top legislature at the end of this year, the premier told the participants.

The meeting of senior officials was held two days before the country's first administrative permit law took effect, and full text of the premier's speech was published by the newspaper, the mouthpiece of the Communist Party of China.

On June 24, Auditor-General Li Jinhua told the national legislature that embezzlement of public fund was found in 55 ministries and commissions under the State Council.

According to the auditing report, 41 ministries and commissions impropriated as much as 1.42 billion yuan (171.56 million US dollars) of fund dedicated to special projects for the construction of residential and office buildings for their own use.

Citing as an example, Li said that since 1999, the State General Administration of Sport embezzled 131 million yuan (15.83 million US dollars) from the country's Olympic special funds for building its own residential community, distributing subsidies to officials and opening up companies.

The premier urged all government functionaries to cooperate with auditing and supervision departments and improve their work.

He described administrative permit law as an important law regulating "the common behavior" of the government, saying it will have a significant and far-reaching impact on government performances.

The law, which experts say reduces the government power, will help increase the transparency of the administrative approval procedures and cut the cost of administration.

The promulgation of the law will also help promote the rule of law in China, which serves the purpose of building a people's government, fighting bureaucracy and corruption and improving the socialist market economic system, Wen said.

The premier urged efforts to build a government that works in accordance with the law, and to this end, governments at all levels should stick to the principles of putting the people first,making timely amendments to the existing laws and regulations while keeping them relatively stable, and maintaining the unity ofvarious laws and regulations to prevent various departments from making their own regulations and even doing things in their own ways.

A solid legal base must be required for any administrative permits, he stressed.

Law enforcement must be strengthened so that government departments and officials implement laws and regulations to the letter, Wen said, promising that violators must be dealt with according to law.

Governments at all levels should perfect the supervision mechanism and encourage supervision on the use of administrative power, including internal supervision and external supervision from legislatures and the media.

A strict system of accountability should be formed and departments and officials with powers should be responsible for their wrongdoing, said Wen.