The government is studying the feasibility of raising the mandatory
retirement age to plug the huge deficit in the pension fund, the China Economic
The social security fund was 800 billion yuan (US$102 billion) in the red at
the end of last year, compared to 36 billion yuan (US$4.6 billion) in 2000, the
Chinese-language magazine said, citing a Ministry of Labour and Social Security
quoted unidentified ministry officials as saying that they would put forward a
proposal on raising the retirement age to the higher authorities within a month.
Guo Yue, a researcher with the All-China Federation of Trade Unions Research
Centre, attributed the shortfall to the fact that many employees retire in their
40s or 50s, much earlier than the requisite age - 60 for men and 55 for women,
or in some cases, 50.
Raising the legal retirement age will delay the payment of pension, according
Official statistics showed that in 2000, the average retirement age was 51.2.
Zhang Hongmei, a bank employee who retired at 45 in 2003, said she is happy
with the 1,200 yuan (US$153) monthly pension. Before retirement, she was paid
1,400 yuan (US$178) a month. Zhang and many others contributed less to the
pension fund than they would have if they had retired at the prescribed age; but
enjoy full pension benefits. The policy allowing earlier retirement was
implemented in the mid-1990s, when State-owned enterprises were reformed.
Early retirement can alleviate some unemployment pressure in the short term,
but over time, it will negatively affect social security and economic
development in an aging society, according to the magazine.
According to the United Nations, China meets all the criteria of an aging
society ?the population over 65 has exceeded 100 million, accounting for 7.7 per
cent of the total; and the population over 60 accounts for 10.5 per cent of the
Shanghai is already considering allowing senior technicians and engineers to
continue working for five to 10 more years after they reach their retirement
age, Shanghai Morning Post reported last week.
However, a central government official is reported to have told China
Economic Weekly that raising the retirement age too fast would exacerbate the
The ministry estimates that at least 24 million urban residents need jobs
each year, but there are only 11 million openings. In addition, there are also
100 million surplus labourers in the rural areas. "We need to balance pension
fund needs and unemployment," said the official.
Making matters worse is that about 7.1 billion yuan (US$905 million) of the
2-trillion-yuan (US$255 billion) social security fund has been misappropriated,
according to the National Audit Office.
Lengthening the working lives of professional talents would benefit both
individuals and the country, says a signed article in Youth Daily. An excerpt
It is reported that the government is considering revising regulations on the