New Realities Drive Population Policy

The State Council has announced that health and family planning as well as food and drug safety is undergoing reorganization in order to increase efficiency. According to The South China Morning Post, the Population and Family Planning Commission has been dissolved, but demographers say this will not change China’s one-child policy:

Cai Fang, director of the Institute of and Labour Economics at the Chinese Academy of Social Sciences, says birth control remains an important policy and it makes no difference which government agency enacts it.

“Over the years, we have gradually transferred from a strict to one-and-a-half children and then a two-children policy, but strict birth control will still be the family planning policy,” Cai said. “The only thing that might change is how different government agencies implement birth control.”

Scrapping the commission does not mean its family planning work is not important any more. “It has no impact on the family planning policy,” he said.

Cai says that part of the commission’s work dealing with family planning services overlaps with the ministry’s activities, while its other work (to do with planning, controlling and drafting strategy) is more in line with the functions of the National Development and Reform Commission.

This restructuring is part of a larger reorganization of the government. Another South China Morning Post article says experts claim the axing of the Population and Family Planning Commission reflects economic and demographic changes:

“Social conditions changed, the economy changed, demographics changed,” said Huang Rongqing, a professor of population at the Capital University of Economics and Business.

“But what changed most was the administration’s understanding of the population issue, that it is an important factor, but not the most decisive factor of the social economy, and that birth control was no longer the most important thing.”

[…]By 2000, the number of people aged 60 or over had surpassed 10 per cent of the total population, and almost 7 per cent of the population were aged 65.

Reflecting the changing demographics, the commission was renamed the National Population and Family Planning Commission in 2003. Ten years on, the agency’s family-planning workload has declined and increasingly overlaps with that of health authorities, Huang said.

CDT previously reported on the shrinking workforce and its implications for China’s economy. Dan Steinbock, the research director of international business at the India, China, and America Institute and a visiting fellow at the Shanghai Institute for International Studies, has also weighed in on China’s changing demographics. From China Daily:

There is a heated debate about whether the family planning policy is bringing China’s demographic dividend to an end. Recently, the National Bureau of Statistics said that China’s working-age population – people aged from 15 to 59 – registered a decline in 2012, dropping by 3.45 million to 937 million. This means that the proportion in the total population shrank by 0.6 percentage points to 69.2 percent. The bureau expects the trend to continue until 2030.

Historically, all the countries that have successfully industrialized have benefited from their demographic dividend. This window of opportunity makes faster economic growth possible. However, the emergence of a demographic dividend is not automatic, it is predicated on effective policies and markets. In East Asia, the demographic dividend has contributed significantly to the expansion of the labor pool and economic growth. In much of the Middle East, demographic changes have generated huge “youth bulges” in the population, but without accompanying job opportunities there has been no demographic dividend.

China is moving from one stage of growth to another. This transition is not new in kind. As advanced economies industrialized and moved from cost efficiencies to innovation, they had to cope with comparable challenges. But what makes the Chinese transition so distinctive and so challenging is its size.

But what if the current demographic trends are allowed to prevail? China’s population size would peak at 1,395 million in 2025. In the next quarter of a century, it would decline by 100 million, to 1,296 million. As a result, the working-age population would drop to 53 percent, or 680 million (a loss of some 240 million in just 35 years). The old-age dependency ratio would soar.

Amid claims that China would uphold the One Child Policy, Laurie Burkitt at The Wall Street Journal talked to Wang Feng, a population expert, about the implications of the reorganization of the Population and Family Planning commission:

What the government is doing is a major political move and they cannot make or announce all the policy changes that go along with it in one day. They know they can’t dismantle everything all at once. It’s going to take some time.

It will not take long, however, for change to come. Leaders are aware of the changing demographics. The one-child policy has taken a toll on the labor force and has jeopardized the future economy.

My reading is that will mean that population control targets will be weaker and weaker over time. And we will see that the one-child policy era is over.

Yet this is incredibly political. The family planning commission employs more than 500,000 people and it will be difficult to change this bureaucracy and what it has done for so many years. The people employed within the system are going to be redundant and many of them will likely leave, enabling a shifting of resources to the Ministry of Health. Those resources can be used to invest in reproductive health.

March 12, 2013 9:48 AM
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Categories: Economy, Society