New Rural Pension Scheme Expected to Achieve Full Coverage from Pilot Points to All Areas

“New Rural Pension Scheme” piloting for less than half a year has helped nearly 3 million farmers make the transition from “family-based elderly care” to “social elderly care.” However, to let more farmers enjoy the benefits brought by the New Rural Pension Scheme, many difficulties remain to be resolved——

Mutual family support and raising children for old-age security have been the traditional elderly care model of Chinese farmers for thousands of years. Since 2009, with the implementation of the “New Rural Pension Scheme” policy, this model has quietly been reformed, and “social elderly care,” which was originally available only to urban residents, has become possible in the rural areas of 12 pilot counties in our province.

“Social elderly care” enters rural areas

Pei Shoucai, a 68-year-old farmer from Zaolin Village, Shanhou Town, Hexian County, never dreamed that after a lifetime as a farmer, in his twilight years he could receive a pension monthly just like the “public employees” in the city.

Elder Pei Shoucai said he would never forget “January 27, 2010” in his life. On that day, the human resources and social security department of Hexian County began distributing the first batch of new rural social pension insurance payments in each town and village, and Elder Pei received the first pension payment of his life. Recalling the scene that day, the elder still could not contain his inner joy: “When I was young, I especially envied the worker brothers for having a pension in old age, with security in old age. Hehe, now us rural elderly have one too.”

Pei Shoucai’s happy later years benefited from the “New Rural Pension Scheme” policy. In August 2009, the State Council arranged to select 10% of counties (cities) nationwide to carry out pilot projects for the new rural social pension insurance, and 12 counties in our province, including Hexian, Dangtu, and Tongling, subsequently became New Rural Pension Scheme pilot areas.

The “New Rural Pension Scheme” combines individual contributions, collective subsidies, and government subsidies, among which the central finance will subsidize local areas and will directly subsidize farmers. In terms of payment structure, the New Rural Pension Scheme is divided into two parts: the basic pension and the individual account pension. The former is fully guaranteed by state finance, which means farmers will all enjoy a nationally universal pension after age 60, currently 55 yuan per month.
 

In view of the fact that the New Rural Pension Scheme policy is another major policy benefiting farmers after the abolition of agricultural taxes, direct agricultural subsidies, and the new rural cooperative medical care system, governments at all levels in our province have adopted active and effective measures for implementation. Pilot counties such as Guzhen and Mengcheng treated this work as the most important livelihood project. Hexian set up “one-stop” service points for insurance participation and payment at each village committee, ensuring that farmers can participate, pay, and receive pensions without leaving their villages. “At present, the New Rural Pension Scheme pilot work is being actively and steadily advanced throughout the province.” According to the relevant person in charge of the Rural Insurance Division of the Provincial Department of Human Resources and Social Security, as of March 30, the cumulative number of insured people in the pilot areas reached 2.847 million, with an insurance participation rate of 53.42%.

Pilot projects initially show Anhui characteristics

During the investigation of the implementation of the “New Rural Pension Scheme,” the reporter learned that our province’s New Rural Pension Scheme policy is consistent with the State Council’s New Rural Pension Scheme policy in terms of guiding ideology, scope of participation, benefit calculation and payment, and conditions for receiving benefits, while also stipulating some specific policies in light of the province’s actual conditions.

According to the relevant person in charge of the Rural Insurance Division of the Provincial Department of Human Resources and Social Security, in setting payment tiers, the provincial government’s implementation opinions set 5 payment tiers of 100-500 yuan, and 9 pilot counties added payment tiers based on local realities; in terms of payment subsidies, the provincial government determined that the subsidy standard should be no less than 30 yuan per person per year, and 10 pilot counties raised the payment subsidy standard; in guiding young and middle-aged farmers to pay over the long term, for those who pay for more than 15 years, for each additional year, the basic pension is increased by 1%, up to a maximum of 10%, and the additional basic pension is borne by the finance of the pilot county; it was clarified that pilot county governments should pay the full pension insurance premiums for severely disabled persons according to the minimum standard; and specific linkage measures were proposed between the New Rural Pension Scheme and the old rural pension scheme, the village cadre pension insurance system, and population and family planning policies.

It was also learned that before the national New Rural Pension Scheme pilot work was launched, our province had already explored and carried out New Rural Pension Scheme work in some places. As early as 2007, the provincial party committee and provincial government proposed to “carry out pilot reform of the rural social pension insurance system and gradually establish a rural social pension insurance system mainly based on individual accounts, supplemented by collective subsidies and government subsidies, and interconnected with other social insurance systems.” Accordingly, Ma’anshan, Wuhu, Huoshan, and other places successively carried out exploratory New Rural Pension Scheme work. “These attempts all provided experience that can be used for reference in the current New Rural Pension Scheme pilot work.” pointed out the relevant person in charge of the Rural Insurance Division of the Provincial Department of Human Resources and Social Security.

After the national New Rural Pension Scheme pilot was launched, all parts of the province showed great enthusiasm for carrying out New Rural Pension Scheme work. At present, in addition to the 12 counties included in the national New Rural Pension Scheme pilot, 18 counties (districts) including Huaiyuan, Feixi, and Nanling have also formulated and issued trial measures for the New Rural Pension Scheme in accordance with the requirements of national and provincial government New Rural Pension Scheme policies, aiming to lay the foundation for future entry into national pilot projects.
 

Hoping for full coverage of policy sunshine

Hexian County and Wuwei County are two counties that are closely adjacent and both belong to Chaohu City. However, farmers in Hexian County can participate in the New Rural Pension Scheme, while farmers in Wuwei County cannot participate because they have not been included in the pilot, and cannot enjoy national subsidies. Regarding this, Wuwei County farmer Pan Dajun was full of confusion: “Fields next to fields, houses next to houses, the same local accent, why is the policy difference so great?”

Farmer Pan Dajun’s confusion expresses the number one difficulty in the current New Rural Pension Scheme work: the state currently conducts pilots in only 10% of counties nationwide, and it is expected that “full coverage” will not be achieved until 2020. As far as our province is concerned, only 12 of more than 100 counties and districts have been included in the pilot. This means that the New Rural Pension Scheme pilot clearly has problems of too narrow coverage and too long a time to achieve full coverage. “Since it is a universal-benefit policy, everyone should enjoy it, and it should not take 10 years to achieve equalization of the system.” During interviews, many farmers who had not yet participated in insurance hoped that the state would accelerate the pace of piloting so that they could enjoy the benefits brought by the New Rural Pension Scheme policy as soon as possible.

After the New Rural Pension Scheme was implemented in the pilot areas, the response was very good, especially welcomed by elderly rural residents. However, in cities, some elderly people without work units, occupations, or pensions also face the problem of elderly care. Sheng Zhongyu, a 52-year-old resident of Xuancheng City, once worked in a collective enterprise when young, and after the enterprise went bankrupt he kept doing odd jobs, and now mainly relies on hourly work to get by. Facing the reporter’s interview, Sheng Zhongyu sighed repeatedly: “When can the government issue a policy benefiting the people so that urban residents like us can also participate in pension insurance and no longer worry about life in our later years?”

The current New Rural Pension Scheme policy contains a provision: rural registered elderly people who have reached age 60 and do not enjoy basic pension insurance benefits for urban employees do not need to pay when participating in the insurance and can receive the basic pension monthly, but their children who meet the conditions for participation should participate and pay. “This is in fact a bundling of the insured subjects.” Some grassroots social security workers explained to the reporter that most rural elderly over 60 now have more than one child, and some farmers feel after calculating the accounts that it is not worthwhile, so they are unwilling to participate. In addition, if the elderly person’s children are unable to participate, the elderly person cannot enjoy the basic pension of 55 yuan per month. But if the bundling rule is canceled, it will cause all eligible participants to be unwilling to put up money for insurance.

The current provisions are not clear enough on the minimum standard for adjusting the basic pension of the New Rural Pension Scheme, mentioning only that “the standard of the basic pension of the New Rural Pension Scheme shall be adjusted in a timely manner according to economic and social development and price changes,” while the amount for preserving and increasing value is not specified. “With prices continuing to rise, after paying premiums for many years, will the 55 yuan basic pension still be enough?” During interviews, many farmers expressed such concerns.

“Although there are still some practical obstacles to overcome in the New Rural Pension Scheme pilot work, we firmly believe that the spring of rural pension insurance has arrived.” said the person in charge of the Rural Insurance Division of the Provincial Department of Human Resources and Social Security with full confidence. (Wu Yonghong)