Millions of people are set to benefit from China's social security fund as it targets 700 billion yuan (US$86 billion) by the end of the year, according to officials with the Ministry of Labour and Social Security.
The ministry's goal of 700 billion yuan (US$86 billion) in social security funds this year is an increase of 100 billion yuan (US$12 billion) over last year, Meng Zhaoxi, director of the Social Security Fund Centre under the ministry, said on Thursday at a working conference in Changchun, capital of northeast China's Jilin Province.
An important strategic reserve for the country, the national social security fund covers medicare, endowment insurance, unemployment insurance, workplace injury insurance and safe-childbirth insurance. The ministry has pledged to enlarge the social security umbrella, to cover more people.
By the end of this year, more than 170 million people are expected to be included in the endowment insurance system and 135 million people to be covered by the basic medicare system, officials said.
The number of people covered by workplace injury insurance is expected to reach 75 million by the end of this year, including all employees of State-owned large and medium-sized coal mine enterprises. More than 47 million women employees are expected to be covered by safe-childbirth insurance this year.
The country will further enhance the management and investment operation of the social security fund by adopting advanced standards, officials said.
More national social security funding is expected to be injected into the stock market this year to increase its value by a larger margin than previous years.
Some 4 billion yuan (US$493 million) of national social security funding has been earmarked for investment in the stock market this year.
The national social security fund first entered the stock market in June last year.
As an important component of the social security system, the fund is facing a series of problems and potential risks as it lacks efficient supervision and management mechanisms, said President Xiang Huaicheng of the National Council for the Social Security Fund.
Xiang announced earlier this year that as much as 8.8 to 17.8 billion yuan (US$1.1-2.2 billion) of national social security funding could be injected into the stock market this year.
China's social security fund can be divided into several parts.
The first part has been raised by the State as a whole and is used to cover existing payments. No money from this portion of the fund is used for capital investment.
The second portion has been raised by the central government and is used in a market-oriented style. Around 40 per cent of the money is invested in the stock market, while the enterprise debt and national debt markets absorb the remainder of the fund.
The third portion includes individual account funds and about 20 billion yuan (US$2.5 billion) in annuity funds of enterprises, which can be put into the capital market.
In recent years, China's social security funds have been operating at a surplus.
(China Daily August 6, 2005)
