The Minimum Living Security System In China

Xu Na

Outline
1.Foreword

2.Background
3.Financial sustainability

4. Problems and experience

1.Foreword
In recent years, the PRC government has made a lot of efforts to improve people's livelihood, and achieved remarkable results. Social assistance system is formed by : The minimum living security system in urban and rural areas Medicaid Othe special relief programs

2. Background
The minimum living security system is a new social relief system in Chinese mainland. Definition: Unconditional cash transfer payments by goverment to the poor families. The beneficiary family's per capita income m u s t l o w e r than the local minimum living standard. The system is based on family economic status survey.

2. Background

Set -up Time Part 1: the urban minimum living security was estabished in 1997. Part 2: the rural minimum living security was built in 2007. The system belongs to the government free salvation.Regardless of social status, age, religion, education degree, only the per capita household income is less than the local minimum living standard ,you can apply the assistance.

2. Background
Scale of beneficiary As of the end of December 2012, the total beneficiary persons are74.83millions, taking up 5.5% of the country's total population.

There's 21.42 millions urban residents and 53.41 millions rural residents receive the relief from this system.

paperwork of an urban munimum living security resident in Yunan

2. Background

Implement institutions This program is implemented by government.The Local governments operate and manage the prgram,and assume the fiscal responsibility. Generally speaking,the bureau of civil affairs undertake the daily management missions.Most of the beneficiaries receive the cash assistance through the local banks in every month.

2. Background How long can the poor enjoy this cash transfer payment? As long as possible,only the per capita household stay below the local minimum living standard . Dynamic Management : The tragets of the minimum living allowance are undergoing dynamic change. When the per-captia income of a household with entitlement increases,the minimum living allowance will decrease correspondingly,if it exceeds the local minimum living standard,the household will be deemed as no longer eligible;if the per-capital income of the household falls,the allowance will be increased.

2. Background

How to get the cash transfer payment?

1st, send an application to local government,take a family as a unit .

2nd,accept the investigation of economic to ensure the per-capita income is below the basic living allowance standard published by the local government,and the financial conditions of the household meet relevant conditions stipulated by it . 3rd,through door-to-door interview ,community review,and publish the information ,local goverment determines the recipients.

2. Background

the publishment

the rural residents receive their minimum living allawance

3.Financial sustainability

1.Mode of financing The Central Government set up the minimum living security subsidy system. In urban areas,it is carried out in 1999, while the system in rural is implemented in 2007. The Central Government covers more than 61% of total financial expenditure . The local goverments cover about 39%.

However .these percentages are nou fixed.

Form1: 2011 central and local financial investment table in social security
Unit: 100 million YUAN

project name

Total financial investment ( amount %

Cental Finance amount %

Local Finance ( amount %

social-

assistance

1833.96 100.00

1187.33

64.74

646.63

35.26

3.Financial sustainability

2.Financial resources

A. per -capita GDP : according to the data from National Bureau of Statistics,in 2012,the GDP in mainland reachs 51.9 trillions Yuan. While ,the total population is 1.3billions. So the per-capita GDP is more than 6,100 US Dollars.

3.Financial sustainability

B. Growth of GDP:(datas from the NBS)

Form: 2009-2012 the growth of GDP in PAC
Year Total GDP
(100 million Yuan)

Rate of growth(%)

2009 2010 2011

335,353 397,983 471,564

8.7 10.3 9.2

2012

519,322

7.8

3.Financial sustainability

C. The percentage of TAX/GDP data from the MOF of PAC

year

total tax gross (100 million yuan )

total GDP tax/GDP % (100 million yuan) 397,983 471,564 18.39 19.03

2010 2011

73,202 89720

2012

100,600

519,322

19.37

3.Financial sustainability

3.Current financial investment In 2012the total investment is 132.6 billion Yuan,including 63.5 billion Yuan for urban residents and 69.1 million Yuan for rural residents.

4. Problems and experience

1.Problems a.Co-ordinate the development in urban and rural ,reduce the gap of minimum living standard between urban and rural while the east and the west . b.improve the security level to meet the poverty's needs. c.resolve issues related to inflation. d.improve the work -method

4. Problems and experience

2.Experience a.Direct cash transfer payments explored a new way to reduce poverty.A lot of practice proved that this way is more effective than those project support /infrastructure construction . b.Community review and publish the applicants' basic information in a certain range can help us to reduce the error rate of social assistance,and the rate of targeting of cash-transfer.

Thanks!
E-mail: xuna@mca.gov.cn