Aging & Social Change: Ninth Interdisciplinary Conference

Abstract

With a rapidly ageing population and an economy that is still underdeveloped, China faces serious challenges to becoming a developed country by the mid-twenty-first century as envisioned by its top leadership. One of the challenges lies in the lack of a well-functioning social security system. This paper sets its topic on social security reform in China by focusing on its impact on the migrant workers in the context of ongoing urbanisation. The data collected from the fieldwork by the authors indicate many irregularities and shortfalls in the implementation of pension policies on the ground by local governments, such as low pension coverage and low portability of pension benefits for migrant workers as well as inadequate pension benefits for migrant-worker retirees, which makes it difficult for them to settle down permanently in cities. Despite the promise made by the central government to make the urbanisation a more inclusive process, a caste-like divide still exists in terms of the entitlement to pension protection between the local hukou residents and the migrant workers, who are victimised by a highly fragmented pension system. The authors argue that the central government should shoulder the responsibility by nationally unifying the pension system to make it function more like an optimal system with universal coverage and adequate benefits for all the participants regardless of their hukou status and occupational background. A nationally unified pension system will not only help make the urbanisation more “people-centred” but also contribute to rebalancing the lopsided intergovernmental fiscal relationship in China.