Reuters. China bets on consumer-led growth to cure social ills

China's new rulers will focus on consumer-led growth to narrow the gap between rich and poor while taking steps to curb pollution and graft, the government said on Tuesday, tackling the main triggers for social unrest in the giant nation

Outgoing Premier Wen Jiabao, speaking at the opening of the annual session of parliament, also announced record government spending in 2013 that will sustain growth and maintain the ruling Communist Party's grip on power through an enhanced budget for internal security.

The plan is the blueprint for the incoming administration led by Xi Jinping, who will formally take over as president at the end of the session, with Li Keqiang taking over as premier.

"Production falls short of the ever-growing material and cultural needs of the people," Wen said to delegates assembled in the Great Hall of the People for the once-a-year meeting of China's National People's Congress (NPC).

China admitted earlier this year there was an urgent need for reforms to narrow an income gap that is now one of world's widest and at levels that analysts say sparks social unrest, despite three decades of blistering economic growth that have lifted hundreds of millions of people from rural poverty.

Beijing also announced an 8.7 percent rise in the 2013 domestic security budget to 769.1 billion yuan ($128 billion), exceeding military expenditure for the third year in succession.

Wen said consumption was the key to unlocking the full potential of domestic demand in the economy of 1.3 billion people, reducing excess, inefficiency and inequality. This, he said, would deliver growth of 7.5 percent in 2013 - a level China barely beat in 2012 when growth eased to its slowest pace in 13 years, expanding by 7.8 percent.

"We should unswervingly take expanding domestic demand as our long-term strategy for economic development," Wen said.

"To expand individual consumption, we should enhance people's ability to consume, keep their consumption expectations stable, boost their desire to consume, improve their consumption environment and make economic growth more consumption-driven."