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Income divide concerns stretching
By Bao Xinyan and Wu Jiao (China Daily)
Updated: 2005-05-04 05:51

The ever-widening income gap between the richest and poorest urban residents has become a hot topic of discussion among officials, experts and everyday people in East China's Jiangsu Province.

Official statistics show that last year the highest earners made 10.7 times as much as the lowest, compared to 5.4 times in 2000 and 9.9 in 2003, according to the Nanjing Morning Post.

"It will harm social reform as well as social stability if the income discrepancy problem is not properly dealt with," said Zhang Yan, chairwoman of the Workers' Union in Jiangsu.

A survey conducted by Jiangsu Workers' Union shows that in 2004, the average per capita income among the top 10 per cent of earners in Jiangsu stood at 13,320 yuan (US$1,680) per year, while that of the lowest 10 per cent was just 1,397 yuan (US$166).

Zhang said the union will try to lift the lowest income level in the province, which is currently 320 yuan (US$39) per month.

The provincial government is calling for regulations to avoid excessive discrepancies in income distribution.

Wu Ruilin, deputy governor of Jiangsu, said at a recent conference that the province is trying to revise the income spread as well as taxation to try to narrow the gap.

"Sufficient employment is the most effective way to solve the problem," said Fan Jian, an economist at Nanjing University.

"Due to the reform of State-owned enterprises, a large number of redundant workers have been laid off. The income gap between the working population and laid-off workers is widening," he explained.

Fan emphasized that companies and enterprises should strive to provide more job opportunities, and the government should strengthen the development of the social security system.

Li Yin, a cleaner in Nanjing, the provincial capital, who had been laid-off, thinks the income gulf is larger than the statistics show.

"My monthly salary is only 400 yuan (US$48), which hardly meets my needs. However, I have heard that some people can earn even several tens of thousands of yuan in one month, and I just do not understand why our incomes are so different," she said.

Wen Jin, with a master's degree in business administration, earns 100,000 yuan (US$12,300) a year working for a foreign-invested company in Suzhou.

"Knowledge is power and money," she said. "But it is not always the truth. Some of my schoolmates have a much lower income, although they are as intelligent as me."

Zhang Bo, a 26-year-old office clerk from Nanjing, thinks that income tax holds the key to closing the gap.

"The high income people should pay more tax, while the low income group pay little, or even no tax," he said.

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