Fixing a hole in the safety net
There's less substance to this announcement than you might expect. A national program that relies on local government's financial participation. Guess where the system will fall apart? (That's not unique to China.)New pension plan to benefit China's 900 mln farmers
Farmers will soon enjoy the same guaranteed incomes later in life as urban workers do, as the government Tuesday announced that a trial pension plan would be implemented across China by October.
Sponsored by the government, farmers over the age of 60 will be able to receive a monthly endowment of varying amounts according to certain areas' income standards, Hu Xiaoyi, vice minister of the Department of Human Resources and Social Security (DHRSS), said yesterday at a press conference...
The old insurance system has benefited 80 million farmers in China since the 1990s. However, the system virtually failed, as it required payment solely from farmers, who eventually gave up because of a lack of money...
The biggest obstacle in applying for the new insurance is the low revenue of local governments.
"Local governments with low revenue have no capability to promote the new policy. With no financial support from the local government, the related department has no enthusiasm to promote the new insurance," said Ding Yifan, a researcher at the Development Research Center of the State Council...
Ding suggested that the governments make a reasonable and balanced financial contribution.
He also called on the government to promote and implement this new endowment insurance policy as soon as possible."
Labels: China, economics, federalism
posted by Ken Wedding @ 7:01 AM
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Chinese Premier urges greater effort for rural pension trial program
"China's governments at all levels should increase their efforts to implement better the rural pension pilot program, said Chinese Premier Wen Jiabao...
"Building a new rural social pension system was an important key in establishing fairness in society and narrowing gaps between urban and rural areas, Wen said. It was also important to improve the social security system, maintain social stability and promote domestic consumption..."
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