Interview: The state of welfare – China Development Brief

From China Development Brief:

When a worker is laid off, are his/her social insurance payments maintained, to ensure that s/he is entitled to future benefits – such as a retirement pension? What agency assumes responsibility for these payments?

ZHANG: Yes, the social insurance payments are maintained. The District Bureau of Labour and Social Security will assume responsibility for receiving social insurance payments; however, the worker has to pay both his and his employer’s share, but the wage base can vary. For example, suppose the worker wants to continue his social insurance payments, he will go to the District Bureau of Social Insurance and decide a level of base wage. He can take a minimum wage of CNY 400 as the social insurance wage base, and pay his share, supposed to be 6%, and his employer’s share, supposed to be 18%; the total is 24% of the CNY 400 – CNY 96 a month – which will be his social insurance payments.

GUAN: Regulations state that once a laid off worker goes to a reemployment centre (ÂÜçÂ∞±‰∏ö‰∏≠ÂøÉ), the centre should take over the payment of his social insurance contributions. The problem, however, is that not every laid off worker can attend a reemployment centre programme because the circumstances of being ‘laid off’ (‰∏ãÂ≤ó) are quite complicated, the reality being that a significant proportion are ineligible to go to such centres. Moreover, a considerable number of those who are accepted by the reemployment centres later find employment in the informal sector, meaning they are no longer able to continue their insurance contributions, effectively leaving them excluded from the ambit of social insurance. [Full Text]


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