China to Boost Social Security Support for Struggling Residents

(Bloomberg) -- China’s government will provide more support to people struggling financially as part of a plan to develop a comprehensive social security system, underscoring its policy shift toward reducing inequality in the economy. 

The government will pay the premium for pension funds for residents facing financial difficulties and provide them aid in medical services, education, housing and employment, according to a “human rights action plan” for 2021-2025 released by the State Council Thursday. The plan also called for the development of corporate annuity programs and private pension funds.

With the population aging rapidly and the birthrate plunging, China is facing a massive funding gap for its main national pension fund. Authorities are planning to raise the retirement age in stages and create a new state-owned pension firm to tackle the funding shortage.

The government will expand a relief scheme for severely impoverished people to those aged 18 from the current 16, according to the document. The plan also called for an effective curb of sexual assault and workplace gender discrimination for women, as well as policies on protecting the rights of workers employed by Internet platforms.

The plan comes against the backdrop of President Xi Jinping’s push to drive down inequality in the country in order to achieve “common prosperity.” Under that campaign, the government has tightened restrictions in a number of industries, including technology, education, property and others, and is seeking better protection for workers.  

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With assistance from Bloomberg