Concern is being raised over Guangzhou's huge pension
shortfall.
Deputies to this year's Guangzhou municipal people's congress
have quizzed department leaders about 800 million yuan (US$100
million) that was invested 13 years ago, just before a change in
national policy demanded it be recalled.
Zhang Jieming, director of the municipal labor and social
security bureau, revealed that only about one-third of the figure
has so far been clawed back.
He added that hope of retracting the remainder of the sum was
diminishing.
According to the official, an unexpectedly swift policy change
was to blame.
State authorities allowed regional institutions responsible for
social insurance and pensions to make money on part of their funds
in 1993 by seeking investment opportunities.
The then Guangzhou Social Security Corp of Guangzhou Labor
Bureau poured more than 800 million yuan (US$100 million) into 25
investment projects in the year.
One year later, however, State authorities ruled such
investments were disallowed and urged related institutions to take
back the money as soon as possible.
As the city's social security company had signed contracts for
the investment projects, Zhang said, the policy change made it very
difficult to retract the money.
The municipal government set up its social security bureau in
1997, which took over the job of tracing back the money.
Three years later, it regrouped its labor and social security
bureaux into a single unit which has been stepping up the
efforts.
He reassured deputies that there was no major cause for concern
over the city's pension structure.
"Guangzhou's social insurance and pensions operation can keep on
track," he said. "Certainly it would be good news if the
municipal's fiscal revenue could fill the gap first."
According to the official, Guangzhou has risk funds to cover
social insurance payments each year and the budget for 2006 has
been enhanced to 80 million yuan (US$10 million), from 50 million
yuan (US$6.25 million) annually, to cover emergencies.
Official statistics indicate that Guangzhou's fiscal revenue
balance surpassed 8 billion yuan (US$1 billion) in 2005.
Yang Chenghua, a deputy from Guangzhou Liwan No 2 Hospital, said
that many deputies hope related government departments will gear up
efforts to claim the pension money back via more channels,
including legal litigation and property auctions.
"Many projects depend on fiscal revenues, and the large pension
gap will undoubtedly lead to inadequate support in other urgent
projects," the deputy said.
Yang said that he and many other deputies would be keeping a
close eye on the situation, and would challenge the government if
retirees were unable to claim their pensions because of the
problem.
(China Daily March 27, 2006)