In the first eight months of this year, the central government allocated 103.2 billion yuan ($16.9 billion) to subsidize families struggling in poverty, according to statistics from the Ministry of Civil Affairs.

As of August, 21 million urban residents were receiving a monthly subsidy of 239 yuan and 53 million rural residents monthly financial support of 104 yuan each on average.

In the past decade, the coverage of minimum living subsidies has grown rapidly in rural areas, with the number of rural recipients increasing from 4.1 million in 2002 to 53.4 million in 2012.

Li Chao received a monthly subsidy of 300 yuan before he found a job as a noodle chef in a small restaurant in Beijing.

His parents said his subsidy was cut off as soon as he was employed although his current job only pays a monthly salary of 800 yuan. Employees' average monthly income in the capital was about 5,200 yuan in 2012.

Li's parents, who are blue-collar workers in their 50s, worry that the family will be trapped in poverty when they soon retire with pensions much lower than their current wages and if their son loses his job. They are not sure whether he can apply for the subsidy again.

Ge Daoshun, a social policy expert at the Chinese Academy of Social Sciences, said the low cash subsidies can only protect people from starvation.

"The current subsistence allowance system can only solve the problem of food for the poor but fails to take into consideration other factors including housing and medical care that are vital for a national's survival," he said.

He urged the government to come up with holistic intervention policies that can meet the diverse needs of different social groups including children, seniors and people with disabilities.