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Pensions need reforming fast

The Chinese government is planning to reform the national pension system. In an article on the website www.bjyouth.ynet.com, a Beijing-based scholar argues that a unified nationwide pension system is an urgent need. The following is an excerpt:

The current pension system has many flaws. A huge gap remains between the urban and rural pension benefits, and workers cannot transfer their pensions across provincial borders. This is unfair for labor from rural areas, and also strangles the free movement of labor.

Thus, the central government hopes to reform the pension system to achieve a unified nationwide system by 2012. Some people doubt big changes can be achieved so fast. Scholar Diwen Deng believes that pension reform is urgently needed, and that targets should and could be met by 2012.

The main obstacle is not a fiscal one, with huge forex reserves and abundant government revenue, but the reluctance of a few local authorities. Hence the central and local authorities should work together to push reform.

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