The accumulated total value of all types of social security funds in China has reached 2.5 trillion yuan, but the annual yield of the five social security funds, pension funds, medical insurance, employment injury insurance, unemployment insurance, and maternity insurance is less than 2 percent on average, said Yu Xiaoming, deputy auditor general of the National Audit Office at the third annual meeting of China Social Security Forum. Beijing Business Today reported Friday.
Yu also warned of increased risks that the value of funds may begin to fall as this situation continues. Speaking of high operating risks, the Vice Chairman of the All China Federation of Trade Unions (ACFTU) said the reason lay in decentralized management of the social security fund, which also reduced the funds' effectiveness in achieving their social goals.
Chen Wenhui, assistant to the Chairman of the China Insurance Regulatory Commission (CIRC) suggested that commercial insurance could be an important alternative and a supplement to basic social insurance. Commercial insurance could provide technological support and management services for basic social insurance, and help reduce financial pressure on the government. He said low-cost insurance products should be developed to provide basic insurance for people who are not covered by the social security system.
Yu also said the role of auditing should be strengthened to set up a healthy operating and management mechanism for social security funds. On one hand, auditing work should guarantee that funds are secure and cannot be embezzle or misappropriated, on the other hand, the focus of auditing work should change from finding loopholes to auditing the performance of the funds.
For more details, please read the complete story in Chinese:
(http://www.bbtnews.com.cn/bignews/channel/political58762.shtml)
(China.org.cn by Star Cheung November 7, 2008)
