Core Viewpoint - The article emphasizes the need to improve China's basic pension insurance system to better meet the expectations of residents and enhance consumption capacity, addressing issues such as low benefit levels, regional disparities, and sustainability concerns [4]. Summary by Sections Current Status of Basic Pension Insurance System - China has established a three-pillar pension system over 70 years, with the basic pension insurance as the foundation, supplemented by enterprise annuities and personal savings [6]. - As of the end of 2024, the coverage of basic pension insurance has reached 1.07 billion people, with a participation rate of 95%, achieving the "14th Five-Year Plan" target ahead of schedule [6]. - The basic pension benefits have been increasing, with urban employee pensions experiencing "twenty consecutive increases" and rural residents' basic pensions growing by 1.6 times over the past decade [7]. Issues Facing the Basic Pension Insurance System - **Insufficient Benefit Levels**: The average monthly pension for urban residents is only 246 yuan, below the rural minimum living standard of 594 yuan [13]. The pension replacement rate for urban employees has decreased to 52%, down 8.7 percentage points since 2018, falling below the International Labour Organization's recommended minimum of 55% [15]. - **Inequality in Benefits**: There are significant disparities in pension benefits among different groups, with urban residents receiving an average of 223 yuan, while enterprise retirees receive 3,271 yuan, and civil servants receive 6,243 yuan [16]. The fiscal subsidies also vary greatly, with urban employees receiving much higher per capita subsidies compared to rural residents [17]. - **Sustainability Concerns**: The pension system heavily relies on fiscal subsidies, with the subsidy amount increasing from 1.2 trillion yuan in 2018 to 1.8 trillion yuan in 2023, accounting for 25.7% of total pension expenditures [23]. The actual contribution rate is low, with the average monthly social security contribution being 1,175 yuan, leading to a significant gap between nominal and actual rates [26]. Recommendations for Improvement - **Enhancing Pension Benefits**: Propose a "State-Owned Capital-Finance-Social Security" linkage reform to increase the pension benefits for rural residents to at least the rural minimum living standard, which could require an additional 800 billion yuan annually [33]. - **Equalizing Fiscal Subsidies**: Suggest gradually reducing the disparity in fiscal subsidies across different groups to ensure a more equitable distribution of pension benefits [34]. - **Stabilizing Contribution Base**: Recommend lowering nominal contribution rates while ensuring compliance with actual contribution levels to enhance the sustainability of the pension system [35]. - **Accelerating National Coordination**: Emphasize the need for a national coordination system for pension insurance to address the challenges posed by population mobility and to balance the responsibilities between central and local governments [30][31].

Group 1: Current Status of Basic Pension Insurance System - The basic pension insurance system in China has a coverage rate of 95%, with 1.07 billion participants as of 2024[18] - Urban employee pensions have been increasing steadily, with a 1.6 times growth in the minimum standard for rural residents' basic pensions over the past decade[18] - The average monthly pension for urban residents in 2024 is only 246 yuan, which is below the rural minimum living standard of approximately 594 yuan[26] Group 2: Key Issues in the Pension System - The pension replacement rate for urban employees has decreased to 52% in 2024, down 8.7 percentage points since 2018, which is below the International Labour Organization's recommended minimum of 55%[26] - There are significant disparities in pension benefits among different groups, with urban residents receiving an average of 223 yuan, while civil servants and enterprise retirees receive 6,243 yuan and 3,271 yuan respectively, making the former's benefits 28 times and 15 times lower[30] - The reliance on fiscal subsidies for basic pension insurance is high, with subsidies reaching 1.8 trillion yuan in 2023, accounting for approximately 26% of total pension expenditures[9] Group 3: Policy Recommendations - It is suggested to implement a "State-owned Assets-Finance-Social Security" linkage reform to gradually increase the average monthly pension for urban residents to the rural minimum living standard, requiring an additional funding of nearly 800 billion yuan annually[57] - A phased approach to reduce the fiscal subsidy gap between different groups is recommended, ensuring that subsidies reflect the contribution levels of each group[59] - Accelerating the nationwide coordination of the basic pension insurance system is crucial to adapt to population mobility and improve the fiscal relationship between central and local governments[61]

Group 1: Current Status of Basic Pension Insurance - The basic pension insurance coverage rate in China has reached 95%, with 1.07 billion participants by the end of 2024[14] - Urban employee pensions have been increasing for 20 consecutive years, while the minimum standard for rural residents' pensions has grown 1.6 times over the past decade[14] - The average monthly pension for urban residents in 2024 is only 246 CNY, which is below the rural minimum living standard of approximately 594 CNY[25] Group 2: Issues in the Pension System - The pension replacement rate for urban employees has decreased to 52% in 2024, down 8.7 percentage points since 2018[25] - There are significant disparities in pension benefits among different groups, with urban residents receiving an average of 223 CNY, while civil servants and enterprise retirees receive 6243 CNY and 3271 CNY respectively, making the former 28 times and 15 times lower[32] - In 2023, fiscal subsidies for basic pension insurance reached 1.8 trillion CNY, accounting for approximately 26% of total pension fund expenditures[6] Group 3: Recommendations for Improvement - It is suggested to increase the average monthly pension for urban residents from 246 CNY to the rural minimum living standard of about 600 CNY, requiring an annual funding increase of nearly 800 billion CNY[51] - A phased approach to equalize fiscal subsidies across different groups is recommended, ensuring that pension differences reflect contribution levels rather than excessive reliance on fiscal support[52] - Accelerating the nationwide coordination of basic pension insurance is essential to adapt to population mobility and improve the financial balance between regions[50]