Pension fund enjoys a surplus
By Feng Jianmin |
July 26, 2012, Thursday
|
Print Edition
Print Edition
CHINA'S current pension fund is in surplus and policymakers will take "slow and small" steps toward raising the retirement age, the country's social security authority said yesterday.
The balance of China's pension fund is more than 2 trillion yuan (US$315.5 billion) as of the first half of this year, said Yin Chengji, a spokesman for the Ministry of Human Resource and Social Security. "Overall, the input to the pension fund exceeds expenditure, and there is no deficit currently," he replied in answer to speculation of a huge pension fund deficit.
But Yin suggested "a minority" of provinces and cities could not make ends meet and relied on central government subsidies to reach a balance.
Yu Zhengsheng, Shanghai's Party secretary, earlier said the city's social security fund was in deficit and the government had to spend more than 10 billion yuan a year to fill the gap.
Yin said the government will expand collection, increase national coordination and adjust fiscal spending so as to achieve a pension fund balance in the long term. He said raising the retirement age is one of the solutions to the problem that are being considered.
"The public had a heated discussion on the issue last month ... which makes us fully aware of the complexity and sensitive nature of the policy," Yin said. "We will continue to study the issue and carefully hear opinions of all sides."
A June report co-authored by Ma Jun, chief researcher at Deutsche Bank, and Fudan University researchers, pointed out that pension fund deficit would take up 10 percent of China's annual expenditure by 2050 even if the government raises the retirement age by seven years by then.
The report suggested an injection of 80 percent of state-owned listed shares to the pension fund to prevent a deficit.
Dai Xianglong, head of the National Social Security Fund, has said several times that China's pension funds should be allowed to invest in the stock market to boost profitability.
The balance of China's pension fund is more than 2 trillion yuan (US$315.5 billion) as of the first half of this year, said Yin Chengji, a spokesman for the Ministry of Human Resource and Social Security. "Overall, the input to the pension fund exceeds expenditure, and there is no deficit currently," he replied in answer to speculation of a huge pension fund deficit.
But Yin suggested "a minority" of provinces and cities could not make ends meet and relied on central government subsidies to reach a balance.
Yu Zhengsheng, Shanghai's Party secretary, earlier said the city's social security fund was in deficit and the government had to spend more than 10 billion yuan a year to fill the gap.
Yin said the government will expand collection, increase national coordination and adjust fiscal spending so as to achieve a pension fund balance in the long term. He said raising the retirement age is one of the solutions to the problem that are being considered.
"The public had a heated discussion on the issue last month ... which makes us fully aware of the complexity and sensitive nature of the policy," Yin said. "We will continue to study the issue and carefully hear opinions of all sides."
A June report co-authored by Ma Jun, chief researcher at Deutsche Bank, and Fudan University researchers, pointed out that pension fund deficit would take up 10 percent of China's annual expenditure by 2050 even if the government raises the retirement age by seven years by then.
The report suggested an injection of 80 percent of state-owned listed shares to the pension fund to prevent a deficit.
Dai Xianglong, head of the National Social Security Fund, has said several times that China's pension funds should be allowed to invest in the stock market to boost profitability.
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