Pensions guaranteed to be paid in full and on time: Ministry of Finance

Volunteers hold a group birthday party for elders in Luqiao District, Taizhou, east China's Zhejiang Province, Oct. 22, 2023. The Chongyang Festival, also known as the Double Ninth Festival, is an annual festival to show respect and care for the elderly throughout China. The festival falls on the ninth day of the ninth Chinese lunar month, which is October 23 this year. (Photo: Xinhua)

China's Ministry of Finance (MOF) confirmed on Thursday that the timely and full payment of pensions can be guaranteed, with financial subsidies to be increased in 2024, in response to the concerns about pension payments as the population ages.

According to China's Ministry of Civil Affairs, as of the end of 2022, the elderly population aged 60 and above in China reached 280 million, accounting for 19.8 percent of the total population, whereas the number as of the end of 2021 was over 267 million, accounting for 18.9% of the total. With the deepening of China's aging population, concerns have been raised about the timely and sufficient payment of pensions, as well as the sustainability of the pension system.

In response to those concerns, the MOF told a press conference on Thursday that as of the end of 2023, the accumulated balance of the national enterprise employees' basic pension insurance fund has reached nearly 6 trillion yuan ($840 billion), which means that the timely and full payment of pensions can be guaranteed.

The guarantee has been achieved through effective improvement in the income and expenditure situation of the fund in recent years, after implementing the measures.

The ministry noted that the financial subsidies have been continuously increased. In 2023, the central government allocated approximately one trillion yuan in basic pension insurance subsidies, focusing on the central and western regions and old industrial bases with difficulties in fund income and expenditure. Local governments at all levels have also been actively implementing expenditure responsibility frameworks to ensure the timely and full payment of basic pensions.

Additionally, reasonable adjustments of the fund balance in various regions have been implemented nationwide starting from 2022. In 2023, a total of 271.6 billion yuan was allocated, effectively addressing the issue of uneven distribution of pension burdens and fund surpluses among regions.

The MOF also emphasized the strengthening of the management of the pension insurance fund, which is to regulate the fund's income and expenditure behavior in various regions by coordinating with relevant departments, so as to promote fair and reasonable fundraising and benefit policies, as well as a more fair and sustainable pension insurance system.

According to the MOF, it has arranged special funds to support elderly care service projects, such as home-based and community-based elderly care services, centralized care for economically disadvantaged or disabled elderly people. It has also introduced a series of tax and fee preferential policies to vigorously support the development of the silver economy.

In 2024, the central government will increase available financial subsidies, while reasonable adjustments to the fund balances nationwide will be further conducted. Additionally, support for elderly care services will be enhanced, with the establishment of a comprehensive network of institutions, communities, and home-based elderly care services, in an attempt to promote the coordinated development of the elderly care industry and services, and improve the quality and efficiency of elderly care services, the ministry said.

During the recent local two sessions period in January, Chinese lawmakers and political advisors have put forward various suggestions to help address the urgent issues faced by the elderly in terms of elderly care, which experts believed will produce significant effects and alleviate the challenges brought about by current elderly care issues from multiple perspectives and levels.