BIZCHINA> Review & Analysis
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BIZCHINA> Review & Analysis
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Migrant workers' pension
(China Daily)
Updated: 2009-10-15 07:53 In South China's Guangdong province, many first-generation migrant laborers - who swarmed to the region from inland rural areas in the early days of reform and opening up - now face the prospect of losing their pension. After working for over 20 years, they are nearing retirement. It is a cruel situation, which cannot be justified by any policy or procedure. In fact, this is a clear case where the policy and rules need to be improved, if necessary, to ensure that those who toiled get their due. The local stipulation requires them to pay into their insurance accounts for 15 consecutive years to be eligible for pension. Most of them paid for more than 10 years since 1998 when the system was kicked off, but that is still short of the stipulated 15. As a result, they are not entitled to pension on the amounts they paid. Instead they might have to withdraw the amounts paid (along with interest for current deposit), and accept the loss of pension. They are forced to forego their pension because, unlike their counterparts with local household registration, they are not allowed to make the payment for the remaining years at this stage. The two issues at this stage are: denial of the time limit as well as local household registration. By any yardstick, the case is unfair and unjust. They have spent their prime years in contributing to the economic development of the Pearl River Delta in South China. But they have turned out to be still aliens in the cities, to whose prosperity they have contributed their youth, now that they are approaching the age of retirement. What makes it even more unfair is the fact that the enterprises that employed them pay 20 percent of the pension insurance and individuals only pay 8 percent, but for any migrant worker to stop paying the insurance, they can only withdraw the money they have paid and the amount of money their working units have paid for them will remain. That is also the major reason why they can hardly transfer their accounts from the city they have been working back to their home cities. They can only do so by handing in the 20 percent that their working units have paid in the past years to their new accounts in their home cities.
Of the nearly 5 million in pension insurance schemes in the city of Shenzhen in 2007, the number of people who have quit and withdrawn their payment amounted to 830,000. Almost all were migrant workers. Undoubtedly something must be done to fix the scheme and make it possible for migrant workers to transfer their pension accounts, including the amount of money their working units have paid for them, to their home cities. Those who are several years away from the 15-year time limit should also be allowed to make the rest of the payment at one go so that they can get pension after retirement. The good news is that two documents concerning the transfer of pension insurance accounts and other related problems for migrant workers are in the making and will be released by the end of the year, according to the Ministry of Human Resources and Social Security. Hopefully, the documents to be adopted will end the discriminatory treatment of migrant workers and relieve them of their worries about life after retirement. (For more biz stories, please visit Industries)
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