Pen­sion pay­ment, health­care ‘will be solved’

China Daily (Canada) - - TWOSESSIONS - By SHAN JUAN shan­juan@chi­nadaily.com.cn

The cen­tral govern­ment will try its best to solve is­sues con­cern­ing peo­ple’s liveli­hoods, such as pen­sion pay­ments and health in­sur­ance, Premier Li Ke­qiang said on Wed­nes­day.

De­spite re­ports of spo­radic cases of pen­sion pay­ment dif­fi­cul­ties in some places, “there will be ab­so­lutely no prob­lem for the govern­ment to meet the pub­lic’s pen­sion pay­ment needs,” Li said at a news con­fer­ence at the end of the two ses­sions.

The na­tional pen­sion in­sur­ance re­serve recorded a sur­plus of 340 bil­lion yuan ($52.3 bil­lion) last year, tak­ing the cu­mu­la­tive fig­ure to 3.4 tril­lion yuan since it was es­tab­lished in the late 1990s, ac­cord­ing to the Min­istry of Hu­man Re­sources and So­cial Se­cu­rity.

More­over, the cen­tral so­cial se­cu­rity fund of 1.6 tril­lion yuan can serve as a strong backup for pen­sion pay­ments na­tion­wide, Li said.

The cen­tral govern­ment set up the pen­sion in­sur­ance re­serve in 1998 to meet the in­creas­ing needs of re­tirees.

In 2014, re­ports that re­tirees could not ob­tain their pen­sions be­gan to make head­lines, with most cases oc­cur­ring in North­east China, the coun­try’s old in­dus­trial base. Many work­ers in this re­gion have been laid off and en­ter­prises closed due to re­struc­tur­ing re­forms since the mid-1990s.

Ni Hup­ing, a se­nior of­fi­cial in charge of pen­sion pro­grams at the Civil Affairs Depart­ment in Zhe­jiang prov­ince, said the prob­lem oc­curred due to in­suf­fi­cient pre­mium in­put in a fledg­ling pen­sion in­sur­ance sys­tem. He de­scribed such a short­age of funds as “a debt left by his­tory”.

Over the past 40 years, China has also im­ple­mented a pol­icy lim­it­ing most cou­ples to hav­ing only one child, which has been cited as part of the rea­son for a rapidly ag­ing so­ci­ety. This has led to many ob­servers fore­cast­ing that the na­tion faces a chal­lenge as pen­sion pay­ments will not be sus­tain­able.

By the end of 2014, China had 212 mil­lion peo­ple age 60 and older, ac­count­ing for 15.5 per­cent of the pop­u­la­tion. The so-called gray pop­u­la­tion is ex­pected to reach 400 mil­lion by the middle of the cen­tury.

To solve this prob­lem, the govern­ment is con­sid­er­ing plans for de­layed re­tire­ment, with an im­ple­men­ta­tion plan to be is­sued in 2017, Yin Weimin, the min­is­ter of hu­man re­sources and so­cial se­cu­rity, said at a news con­fer­ence last week.

Ni sug­gested that other mea­sures be taken to help ease pen­sion pay­ment pres­sure, such as mak­ing the pen­sion sys­tem more in­de­pen­dent and trans­par­ent and set­ting up a risk preven­tion sys­tem.

Li said he is con­fi­dent the pen­sion prob­lem can be solved, adding that this will not be “an empty prom­ise to en­sure that the el­derly are pro­vided for”.

Bet­ter health­care

Af­ford­able health­care

is an­other ma­jor con­cern.

As part of the on­go­ing health­care re­forms, di­rect set­tle­ment of hos­pi­tal ex­penses for re­tirees in ar­eas away from their home­towns will be re­al­ized in two years, Li said.

Cur­rently, health in­sur­ance poli­cies in China are re­stricted re­gion­ally, and many re­tired peo­ple find it hard to get their med­i­cal bills re­im­bursed if they go to hospi­tals out­side their home­towns.

“The govern­ment is re­solved to achieve na­tional porta­bil­ity of med­i­cal in­sur­ance plans at a faster pace,” Li said, adding that pro­vin­cial-level porta­bil­ity will be achieved within the year.

“All the govern­ment’s work aims to im­prove the pub­lic’s well-be­ing, so we need to cater to peo­ple’s wishes for a bet­ter

Ag­ing pop­u­la­tion

Pro­jected per­cent­age of peo­ple aged 60 and above of China's en­tire pop­u­la­tion life as we strive for de­vel­op­ment and re­form.”

China has a two-tier pub­lic health in­sur­ance pol­icy sys­tem — one for ur­ban em­ploy­ees and the other for the un­em­ployed in ru­ral and ur­ban ar­eas. More than 96 per­cent of the pop­u­la­tion has been put un­der this um­brella.

Re­spond­ing to com­plaints that the bur­den is too heavy for in­di­vid­u­als and their em­ploy­ers to pay in to in­sur­ance plans that cover pen­sions, health­care, un­em­ploy­ment, work­place safety and ma­ter­nity, Li said, “There is still room for us to cut the ra­tio of con­tri­bu­tions to th­ese in­sur­ance plans.”

An em­ployee with a monthly salary of 8,000 yuan can only re­ceive 5,000 yuan, with about 3,000 yuan go­ing to the in­sur­ance plans. His em­ployer has also to pay a pro­por­tion­ate amount to the plans.

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