Hukou Reform in Spotlight at NPC

What began in the early days of the PRC as a regulatory means to ensure that enough rural labor stayed where it was needed to work the fields, China’s household registration, or hukou system, has long been criticized as outdated. Rural migrants have fueled China’s rapid growth, but lacking a hukou (and hence local residency status) for the city in which they toil, they are limited from accessing the local social services enjoyed by urban residents. While reform to this system has been discussed for some time, little change has been seen, and China’s new leaders have recently pledged to hasten systemic reform. Reuters reports from the National People’s Congress, where last week outgoing premier Wen Jiabao stressed the need for hukou reform in terms of economic development:

China’s new leaders are planning a system of national residence permits to replace the household registration or ‘hukou’ regime, a government source said, a vital reform that will boost its urbanization campaign and drive consumption-led growth.

[…]In a speech to parliament on Tuesday that laid out the blueprint of the new leaders, outgoing Premier Wen Jiabao said hukou reforms should be accelerated to drive an urbanization effort that he said would underpin economic development.

[…]Wen said consumption was the key to unlocking the full potential of domestic demand in the economy and would reduce excess, inefficiency and inequality. It would also help deliver growth of 7.5 percent in 2013 – a level China barely beat in 2012 when growth eased to 7.8 percent, its slowest pace in 13 years.

An op-ed in the South China Morning Post has more on Wen’s urbanization-themed work report at the NPC, and outlines the shortcomings of previous attempts to reform the system before offering policy advice for successful hukou reform:

In addition to the city-level system, a metropolitan-wide hukou system could also be launched. In Shenzhen, the newest of the mega cities, fewer than 20 per cent of the population have local hukou; increasing this figure should be a social development priority.

Guangdong could try a new breed of metro hukou for the Pearl River Delta. The 50 million urban residents in the top six delta cities – Shenzhen, Guangzhou, Dongguan , Foshan , Zhongshan and Zhuhai – have similar income levels. So a new class of metro hukou, allowing full mobility within the delta area, could be offered. This would further improve the economic and social cohesion within the region.

Beyond the regional level, a national hukou system, allowing limited mobility across major cities such as Beijing, Shanghai, Guangzhou and Shenzhen, could be considered at an appropriate time.

In 2011, China’s urban population passed 50 percent, and the central government projects that it will reach 60 percent by 2020 – the steady flow of rural workers to China’s cities is set to continue. China.org.cn reports on an NPC delegate who stressed the need to make migrant workers permanent residents in the cities that they work:

Ma Xu, a Beijing delegate to the first session of the 12th National People’s Congress (NPC) said during a speech that he hopes the term “migrant worker,” low-income individuals who leave their rural hometowns in search of work in larger urban areas, will no longer be relevant within five years.

[…]Ma stressed the importance of permanently moving migrant workers into urban areas. He saidthat the government needs to take into consideration the development of human resources of the floating population, with the migrant workers as the greatest group, in its urbanization plan, so as to make history the word “migrant worker” in China within five years.

To reach this goal, special funds need to be allocated to create a occupational skills training system for migrant workers with programs designed to help them start their own businessnesses.

Ma suggested that the integration of new city dwellers should be included in China’s urbanization plan, and detailed plans should be designed as soon as possible.

One oft-covered symptom of China’s dysfunctional hukou regime is a lack of public schooling for the children of migrant workers. The children who aren’t left behind in the countryside rely on unlicensed schools whose future’s are anything but certain. Another recent report from the South China Morning Post profiles the Xiangyang Primary School, a school for migrant children in Beijing:

Founded four years ago, the Xiangyang school has an enrolment of about 700 pupils from migrant families. The school’s principal, Luo Chao , said the school receives no financial support from the local government because they have not been able to obtain an operating licence from local authorities. In 2006, a freeze was placed on the issuance of licences for schools that cater to migrant children, but the schools are still allowed to exist and are even subject to safety and hygiene inspections.

Already struggling to keep the school open with a lack of public funding, Luo said he must charge pupils very low tuition rates because most of their parents are low-income migrant workers. He said the school charges students just 130 yuan a month for lunches, even as inflation pushes food prices higher.

“We know we might not be able to meet [education] standards, and pupils would be better off at public schools or government-funded schools,” Luo said. “But the fact is, we’re still sought after by parents. We’ve done the government a favour by providing pupils with the schooling that they have failed to deliver.”

Reporting from another of Beijing’s migrant schools, one they may soon be razed to make room for new development, CNN notes that local political and economic concerns stand in the way of national level hukou reform:

“The government is trying. They’re definitely making efforts, they realize that this is a big problem,” William Nee of the China Labour Bulletin said. “The problem is the finances of the health care scheme and education are all done at the local level, so I think it’s very difficult for the government at the national level to say, ‘Okay, let’s just reform the hukou system’.”

The political cost of reforming the hukou system is onerous. “The mayors and party secretaries of many major cities are concerned that if hukou is freed up, there will be a huge fiscal burden in providing services for these migrants,” said Yukon Huang, senior associate of the Carnegie Endowment and former World Bank director of China.

“If you ask the residents, the established residents of the major cities, they would say I don’t want more people coming, this may mean fewer job opportunities for us,” Huang added.

Also see a New York Times “Letter From China,” in which Didi Kirsten Tatlow looks at one migrant’s life and the difficulties that have come with urban living.

For more on migrant workers and the hukou system, see previous CDT coverage.