Making migrant workers urban residents becomes the top priority of urbanisation

According to the spirit of the Central Urban Work Conference held from December 20 to 21, the next step in advancing urbanisation is to make it the top priority to grant urban residency in an orderly manner to permanent residents who are able to find stable employment and live in cities and towns.

It is necessary to strengthen strategic research on granting urban residency to the rural population that has moved to cities, and to coordinate supporting reforms in such areas as land, public finance and education. We should promote a new type of people-centred urbanisation, give play to this greatest potential for expanding domestic demand, and effectively resolve various “urban diseases”.

Data obtained by 21st Century Business Herald shows that at the end of the third quarter of this year, the growth rate of the number of migrant workers working away from home turned to zero growth, which indicates that in reality migrant workers' willingness to move to cities has declined. The reason is that migrant workers currently find it difficult to enjoy public services such as education, elderly care and housing in cities, which may affect the urbanisation targets and in turn affect the sustainable growth of the entire economy.

The new urbanisation plan previously issued by the state proposed that by 2020 the urbanisation rate of permanent residents should reach about 60%, and the urbanisation rate of registered residents should reach about 45%, increases from the proportions of 52.6% and 35.3% respectively in 2012. The gap between the urbanisation rate of registered residents and the urbanisation rate of permanent residents should be narrowed by about 2 percentage points, and efforts should be made to grant urban household registration to about 100 million people from the rural population that has moved to cities and other permanent residents.

Central authorities propose strengthening research on granting urban residency to migrant workers

The conference put forward 6 tasks. These are: respecting the laws of urban development; coordinating the three major structures of space, scale and industry to make urban work more holistic; coordinating the three major links of planning, construction and management to make urban work more systematic; coordinating the three major drivers of reform, science and technology, and culture to make urban development more sustainable; coordinating the three major layouts of production, life and ecology; and coordinating the three major actors of government, society and residents to increase the enthusiasm of all parties in promoting urban development.

On strengthening strategic research on granting urban residency to migrant workers, the conference proposed coordinating supporting reforms in such areas as land, public finance, education, employment, medical care, elderly care and housing security. It is necessary to advance reform in many areas such as urban science and technology and culture, optimise the ecosystem for innovation and entrepreneurship, make innovation the main driving force of urban development, and release new momentum for urban development.

In this regard, Ye Tanglin, a researcher at the Megacity Research Institute of Capital University of Economics and Business, believes that the most crucial thing is that many education, medical and other services should go to small and medium-sized cities.

Many remote areas may simply lack high-quality teaching staff, so people with even a little ability still hope to go to big cities for schooling. Therefore, on the one hand, equalisation of public services must be achieved, and on the other hand, employment in small and medium-sized towns must be created as much as possible. “But this is a long-term process, and it is difficult to solve it immediately in the short term,” he said.

Liu Xiangdong, a researcher at the China Center for International Economic Exchanges, pointed out that some specific measures still need to be studied in this regard. “If Langfang had education and elderly care services like those in Beijing, surely many people would be willing to settle there,” he said.

Advancing equalisation of basic public services for permanent urban residents

The above-mentioned Central Urban Work Conference also proposed improving the level of management, striving to build smart cities, using the implementation of the residence permit system as a lever, advancing equalisation of basic public services for permanent urban residents, strengthening urban public management, comprehensively raising the quality of residents, and promoting reform and innovation to provide institutional safeguards for urban development.

21st Century Business Herald has learned that the residence permit system currently implemented in some large cities and megacities has encountered an awkward predicament. Many permanent residents without local household registration believe it is mostly a pie in the sky.

Xia Dan, an analyst at Bank of Communications, believes that the residence permit system needs reform. In many cities it is very difficult for the children of permanent residents to receive education, and household registration and other requirements are needed. If one has local household registration, one's children can attend school even without having bought a home.

Cultivating a number of city clusters in the central and western regions

The Central Urban Work Conference proposed raising the level of the new type of urbanisation and forging a path of urban development with Chinese characteristics.

To this end, a number of city clusters and regional central cities should be cultivated and developed in the central and western regions, and the linked development of border central cities and port cities should be promoted, so that the broad masses in the central and western regions can also share in the fruits of urbanisation at their doorsteps.

Each city should, in light of its resource endowments and locational advantages, clearly define its leading industries and distinctive industries, strengthen industrial collaboration and synergy among large, medium-sized and small cities and small towns, and gradually form a development pattern of horizontally differentiated development and vertically divided and coordinated work.

“The current insufficient development of small and medium-sized cities is precisely that they have no industries and have not formed industrial linkages with core cities or an industrial chain layout,” said Ye Tanglin.

⟧ Encouraging farmers to buy homes in cities and giving play to the greatest potential of domestic demand

The Central Urban Work Conference is prepared to promote the new type of urbanisation as the greatest potential of domestic demand through a number of reforms.

The conference pointed out that to build a moderately prosperous society in all respects and accelerate the realisation of modernisation, it is necessary to do a good job with the city as the “locomotive” and grasp the laws of development.

To this end, it is necessary to raise the level of construction, strengthen urban underground and above-ground infrastructure construction, build sponge cities, accelerate the renovation of shantytowns and dilapidated houses, advance in an orderly manner the comprehensive renovation of old residential communities, strive to basically complete by 2020 the renovation of existing urban shantytowns, urban villages and dilapidated houses, promote green urban development, raise building standards and project quality, and attach great importance to building energy efficiency. It is necessary to raise the level of management, strive to build smart cities, and so on.

21st Century Business Herald has learned that currently more than 200 million migrant workers live in cities, but the proportion who have bought homes is only about 1%. If migrant workers settle and develop in cities, calculated on the basis of 3 people per household and each household buying a 70 sq m home, a conservative estimate puts housing demand at several billion to more than ten billion sq m, which could greatly promote the destocking of inventory.

Xia Dan, an analyst at Bank of Communications, believes that the core issue in promoting the granting of urban residency to migrant workers is solving the problem of farmers' income. The government can provide some subsidies or other means to help migrant workers purchase property.

November economic data shows that China's real estate investment growth rate was near zero growth, which also led to a slowdown in overall investment growth, with cumulative monthly investment growth falling by about 0.5 percentage points, and the entire economy under great downward pressure on growth.

Ye Tanglin, a researcher at the Megacity Research Institute of Capital University of Economics and Business, believes that promoting migrant workers to buy homes in cities, which could also be affordable housing, is possible, but the premise is that the government must have a scientific plan and large upfront investment.