Social Security Pension System Reform in China

Author: Joint Expert Group of China Foundation for Economic Reform Research and China Research Association
Publisher:
Publish Date: 2006-07-09
Features: This book discusses the history, current status, and future of China's pension system reform. The pension system reform is a key and challenging aspect of China's economic system reform and has always received high attention from governments at all levels and the entire society. Currently, China's pension system is fragmented by regions with a narrow coverage, and the social pooling deficit is covered by individual account contributions, leading to the "empty rotation" of individual accounts. Over time, these issues may affect the enthusiasm of enterprises and individuals to pay contributions, making it increasingly difficult to expand coverage and putting greater pressure on the government budget. This book reviews the establishment and development of China's pension system since the founding of the country, analyzes the current status and challenges of the pension system reform, and applies economic principles while summarizing international new experiences and lessons. It clearly proposes that learning from and adopting Sweden's Notional Defined Contribution (NDC) system may be a practical and effective approach for China to improve its pension system and resolve the "empty account" issue. Based on this, the book puts forward actionable policy recommendations for China's future pension system reform.