Most Chinese people rely on personal savings to support them in
old age, according to a survey organized by the Society Research
Center of China Youth Daily and
www.news.sina.com.cn. The survey interviewed 3,871
people, only 20.2 percent of whom thought they could even partially
rely on government security programs.
Mounting pressure for rural elderly
“The negative effects of aging can be seen most clearly
in rural areas,” said Tang Jun, Secretary-General of the Social
Policy Research Center of the Chinese Academy of Social Sciences.
Although the old-age insurance system is not perfect, the effects
of aging in cities are limited because labor forces from rural
areas will always be available; however, rural areas do not have
the same influx of able-bodied workers.
“The second and the third generation of peasant workers are
reluctant to go back to the countryside,” Tang explained. “The
aging population will therefore be a big problem in rural areas
within the next ten years.” The proportion of aged people amounts
to 7.13 percent in rural areas, while in cities the figure is 6.69
percent, according to the 2000 population census.
China’s social security system does not cover the elderly living
in the countryside, so the pressure on them is a growing concern.
By the end of last year 1,905 counties in
China had implemented an old-age insurance pilot project and the
number of farmers enrolled in the insurance program reached 53.73
million; 3.55 million farmers were covered by the old-age pension,
but each elderly person in the countryside may only receive 1,000
yuan (US$133) per year.
Older people’s homes see little profit
“Investment towards old-age support in China will not bring huge
profits, at least not at the present time,” Tang Jun said while
addressing a recent forum on aging issues.
Currently, the number of people aged above 60 is 140 million in
China, which accounts for 11.03 percent of the total population.
The problem this creates is, the greater the number of elderly
people, the greater the need for old age support funds. “The older
Chinese population is not strong in terms of consumption capacity.
They dare not spend money.” Tang explained.
China lags behind developed countries in terms of the
construction of older people’s homes and social welfare homes, and
also falls short of the effort put forth by other developing
countries such as Brazil. The reasons for the lack of old-age
support homes can be found in the Chinese economy and culture. The
cost of a nursing home with good conditions is between 2,000 and
3,000 yuan per month, not an affordable amount for a common
household.
On top of this, it is a traditional Chinese practice that
children will ensure their parents are looked after in old age. It
is therefore considered a dereliction of duty for children to take
their aged parents to nursing homes, said Xu Zongwei, Deputy
Director of the Policy and Regulation Department of the Ministry of
Construction.
Government should guarantee minimum income
“The social security system should include both a base income
and a supplementary fund,” Tang Jun said. The base income should be
more accessible and guaranteed by national finance to ensure a
basic standard of living. The supplementary fund should be operated
like a comprehensive individual account, meaning the funds could be
lent out as mortgage loans for buying houses, vocational training,
education for children, and even for medical expenses in special
circumstances. This loan could then be paid back in installments
based on the current interest rates.
Tang believes the elderly simply don’t have enough time to
accumulate funds for their retirement funds. He suggested that
pension funds be generally provided to all elderly people above 70
in rural areas. “If the elderly people have disposable income, they
will be able to buy old-age support service products,” he said.
(China.org.cn by Yang Xi, September 25, 2007)