• The Financial District

PENSIONS FOR ELDERLY CHINESE RURAL PEASANTS ‘COVER ONLY OIL AND SALT’

The plan of Chinese President Xi Jinping to eradicate poverty among 1.4 bilion Chinese is getting mocked by peasants themselves who have toiled past their retirement age of 60 since their pensions “cover only oil and salt,” an indictment of the unequal pension system that punishes people in the rural areas.

In an article for the South China Morning Post (SCMP) on August 22, 2020, Orange Wang said that he Chinese Academy of Social Sciences (CSASS) has said that by 2025, one of four residents in the countryside—a total of 124 million-- will be older than 60 and is thus eligible for state pension. Yet, the rural pension system was initiated only in 2009 by then-president Hu Jintao and then-premier Wen Jiabao. Before this, the Deng Xiaoping bureaucrats only had a pension system for urban residents.


Chen Yunfeng, the chief of Yancang village in Henan province, has grown dismayed by the disadvantages that aging rural peasants face in China. “We plant grains, but grains are cheap… And we are getting old, but there’s little welfare.” Chen said a peasant from the village can receive a monthly pension of just 112 yuan (US$16) after the retirement age of 60 – a tiny sum that is well below the average daily wage in Chinese cities and far from enough to support even a frugal rural lifestyle. It is also much lower than the national average pension payment of 2,000 yuan (US$290) per month for retirees from urban jobs. In Zhengzhou, the provincial capital of Henan province, the average pension for those enrolled in the urban and rural residents pension scheme was just 243 yuan per month in 2019, or less than a tenth of the 2,928 yuan for those in the urban corporate employee program.


Wang said a horrific incident cast a spotlight on the problem in May, when a man in Shaanxi province attempted to bury his bedridden mother alive because she had become incontinent and a burden to care for. The 79-year-old woman was eventually saved, and the man was arrested, but the case set off a nationwide debate on who will look after China’s growing number of elderly residents in rural areas. The situation is also casting a shadow over Beijing’s new economic strategy of “dual circulation”, an effort to turn the country’s 1.4 billion people into a consumer powerhouse to sustain domestic growth amid an increasingly hostile and uncertain external environment, particularly as a result of China’s escalating rivalry with the US. Peasants have also made contributions to the country, but their treatment by the state is very different from that for retired public officials and urban workers. Ma Wenfeng, a senior analyst with Beijing Orient Agribusiness Consultant, said the lack of adequate pensions for Chinese farmers is severely restricting Beijing’s efforts to create a unified consumer market, in large part because more than 40 per cent of the country’s households are forced to save up enough to fund their old age. “A monthly cash handout of 100 yuan or so certainly can’t make all ends meet, meaning peasants have to keep farming small plots of land for survival even when they are really old,” Ma said. This, in turn, has adversely affected agricultural productivity in China.


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