China to Increase Budgetary Spending for Social Security

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Last updated at: (Beijing Time) Thursday, March 06, 2003

China to Increase Budgetary Spending for Social Security

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The Ministry of Finance proposes that expenditures for social security programs should be expanded in 2003, saying that spending on social security programs will be increased to help urban residents in straitened circumstances meet their basic living needs and safeguard the immediate interests of the general public.

Minister Xiang Huaicheng made this proposal Thursday, while delivering the Report on the Implementation of the Central and Local Budgets for 2002 and on the Draft Central and Local Budgets for 2003 at the current First Session of the 10th National People's Congress.

According to the minister, the increased budgetary expenditures are to be used in areas as follows:

An additional 8.4 billion yuan will be used to increase the basic pensions for retirees from state-owned enterprises, the retirement benefits of veteran cadres who joined the revolutionary ranks in the early days of New China and pensions for older ex-servicepersons in rural areas.

An extra 4.6 billion yuan will be allocated to implement the policy of doubling the subsistence allowances for those urban residents living below the poverty line, and an extra 4.7 billion yuan to implement the policy of subsidizing reemployment programs. In addition, The government will continue to allocate 11 billion yuan to subsidize the bankruptcy of enterprises according to law.

According to the minister, expenditures for social security programs from the central budget for 2002 came to 136.2 billion yuan, an increase of 38.6 percent over the previous year.

In addition, financial authorities cooperated with competent government departments to tighten collection, management and supervision of social security funds and improve the method of making special transfer payments for social security and the system for managing the special financial accounts for subsidies under social security programs.

The minister noted that experimentation with the reform of social insurance fees collected by tax organs was extended to 16 provinces.

In addition, he said, financial authorities took an active part in and gave support to the reform of the basic medical insurance system for urban employees and experimentation with the reform to improve the urban social security system in Liaoning and other provinces.

All this promoted smooth implementation of the reforms, he said.

Statistics show that basic pensions for retirees from state-owned enterprises and living allowances for workers laid off from state-owned enterprises who had registered with reemployment service centers were basically paid on time and in full as of the end of 2002. The number of urban residents who received subsistence allowances rose from 1.84 million at the end of 1998 to 20.6 million at the end of 2002.

This helped maintain social stability, he stressed.

In the past five years, the central financial authorities have accumulated 124.2 billion yuan in the national social security fund. This has provided an important financial means to prepare the country for possible emergency, he said.

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