Research On Reform Of China’s Pension System

The population aging is a world-wide topic, whether developed or underdeveloped countries, are facing the problem of it. In the 1970s, with the combined effect of the global trend of an aging population and economic stagflation, the public pension systems in many countries are facing fiscal crisis. In order to release the increasingly heavy pressure on public pension and reduce the negative effects of the high-welfare policy on economic development, many countries have to take all-round reform countermeasures to the existing public pension system. With the deepening reform process of the public pension system, especially the common problems facing in countries with economies in transition, the supplementary pension including occupational pension and insurance contracts pension, becomes a pilot area of social security and cutting-edge topics. This is because (1)in industrialized countries, the crisis inherent in the public pension system has not been fundamentally resolved, and the supplementary pension scheme as a policy adjustment means to ease the pressure of social insurance scheme and the growing fiscal burden will be taken seriously in a long-term by the government.(2)in the prospects of accelerated development of the aging population, the supplementary pension scheme, though may be in different position and different forms within the different framework, the expansion of its role in social insurance is undoubtedly one of the focus. (3)With the integration of social insurance and economic development strategic, the mode of social insurance fund system and supplementary pension fund operation system will play a more important role in the promotion of economic development. (4) In the case of countries with economy in transition, the partly development of a sound system of social insurance schemes and supplement plan will help promote economic development, it is also very important to the development of financial market as well as help the economy out of its predicament. For this reason, multi-pillar pension system was the concern of policy makers, and will become a very important area of development. China began to reform the pension system to adapt the requirements of market economy from 1990s, through the efforts of the past 20 years, China has formed the basic framework of public pension system. Although China has always advocated building a multi-pillar pension system, in fact she is still dominated by a single pillar public pension system. There are many problems in this single pillar of pension system, whether from the social pension coverage or financial resources, as well as supply and demand situation or the regulatory function of the income distribution, are far from meeting the needs of the people. In the background of China’s speeding up of the population aging and huge gaps of public pension funds, in the context of exploring the government to reduce pension liability, the expansion of enterprises and individuals, such as the main market to assume more responsibility for pension, in particular, is to explore the insurance contracts pension in the pension system in the positioning and development have important theoretical significance and practical application of the guidance value.This dissertation focus on reform of pension system, as well as the positioning and development of insurance contracts pension.first,this dissertation recalls the history of public pension system, observation of public pension, occupational pension and annuity business in the old-age insurance system in different historical periods of the status and role and look forward to the future of commercial annuity. Then, an analysis of pension insurance based on economic theory, summed up the state interventionism and economic liberalism on the issue of older views and ideas, the world’s old-age insurance system is to achieve real reform of old-age insurance in the government and the market supply of the main responsibilities of the re-demarcation by the Government to the market transfer of responsibility for more space. Then, to the welfare state reform of old-age insurance system is based on to inspect the old-age insurance system reform on the commercial impact of an annuity, can be summed up with the lessons of experience to draw on. And then through China’s pension system reform, reveals the aging of the population of the current grim situation, the existing old-age insurance system problems, pointed out that the old-age insurance system in China’s future direction. Then, in order to reform old-age insurance system based on the positioning of our annuity business and development. Papers from the perspective of static and dynamic calculations of the future costs of pension annuity business, as well as ways of funding given to promote development of commercial annuity. Finally, in view of preferential tax policies at the national old-age insurance system reform, an important role in China’s construction of a multi-pillar old-age insurance system in the context of commercial annuity to obtain the same can not be separated from the development and strengthening of tax policies. Isolation of the article does not tax pensions business, but the trust-based occupational pension, occupational pension and contract type on the annuity business of a unified framework to discuss the tax, with a view to a more macro conclusions.Papers focus on the reform of old-age insurance system and its impact on the commercial impact of pension on this issue. To the United States, Britain, Germany and Japan based on the four countries, visited the old-age insurance system, pension reform and the impact on business. Although the path of reform in different countries, the effect of differences in the reform process but still showed some of the same characteristics: First, old-age insurance system from a single pillar to pillar of the structural adjustment and more, to weaken the status of public pension, and occupational pension and annuity business general strengthening of the role; second is that the cut in its own borders, to businesses and individuals transfer more responsibility for old-age security space; The third is from the focus on welfare to move closer to the basic livelihood guarantee to provide a national economic development, flexible with the future sustainability of the pension level as a general consensus; Finally, the goal of old-age insurance system shifted from the emphasis on a fair balance between fairness and efficiency. In essence, the world’s old-age insurance system reform, the basic characteristics can be summed up as individuals and the expanding role of the market and the responsibility of State and Government of the gradual narrowing of the fundamental trends in old-age insurance system which is the core of the reform. This trend reflects:the world’s old-age insurance system characteristics remedy increasing gradually to reduce the characteristics of the system; system components and flexible increasing rigidity of the factors system declining. Furthermore, the reform of the welfare state has given us three important revelation:First, the choice of system is very important to have the old-age insurance system of sustainable development; second is to moderate the level of protection to prevent future cumulative overkill and drastic action, such as generation. Third, reasonable definition of old-age insurance system in government, business and personal boundaries.China’s old-age insurance system faces many problems. Aging of the population, the huge gap stealth debt, public pensions are the disadvantages of a single pillar of the system shows the urgency of reform. China’s pension system, the fundamental problem is that too much public pension replacement rate is the Government’s responsibilities in the area of old-age insurance over the "degree", the high public pension replacement rate, strengthen the people to rely on state and government awareness of the issue of old age weakened the people’s means of other old-age needs, not only to the government a heavy burden to a large extent also affected the commercial annuities, such as the establishment of supplementary pension. Welfare state, experience tells us that excessive public pension replacement rate, the Government of older citizens is bound to incur the risk of real punishment, the old-age insurance system for the rich, diverse means of old-age security to the future aging society capable of elderly security needs. Otherwise, they will fall into the cycle of welfare. The experience of China’s economic development such a limited, relatively low per capita income, especially in developing countries. Therefore, China’s pension system is not a technical matter, nor is it to operate, but first of all, the system is the structural problems in the reform of the system must begin with old-age insurance system initiated structural adjustment. The future, remedial-type old-age insurance system in China should become the model of ideal choice. This is determined by the remedial-type old-age insurance system determined by the advantages of:1, remedial-type public pension system for citizens to meet the basic survival of the old age security, pension insurance system is in line with the Government’s "degree" of the requirements in line with China’s the reality of the socio-economic conditions.2, the flexibility of the system remedial type old-age insurance system will help the long-term sustainable development.3, the remedial-type system in favor of market-oriented characteristics of the perfect capital market.4, remedial-type old-age insurance system not only stressed the importance of fairness, balance and efficiency. Adjusted old-age insurance system in China is a three-pillar system, the first pillar is a public pension is a low level of benefits, and for maintaining the basic livelihood of the elderly population security, the second and third pillars of the Government’s encouragement to participate freely in the occupational pension and annuity business to meet the difference between the people of old age security needs, the ratio of 3:3:2 among the three. In the three-pillar pension system, the government’s role is mainly embodied in two aspects:First, the first pillar of direct organizations; the second is the basic guarantee of the first pillar, to provide to the tax system as the core of policy space to promote the second and third the development of the pillars of old-age pensions, the mechanism of market competition through its own organization. Therefore, only when the public pension as defined in a reasonable interval in order to occupational pension and annuity business delivered a greater scope for development, in order to build a balanced, long-term sustainable development of old-age insurance system.Paper has proved that the commercial future of old-age pension insurance system is an important pillar. With the aging of our population to accelerate, business trends and the demand for annuities and pensions of the total needs of the future will be a leap upward trend, China’s sustained rapid economic growth for the business of the old-age pension expenditure on the provision of financial support. Annuity business in the old-age insurance system is an important pillar of our country lies in the context of the particular, its unique positioning:In view of China’s public pension insurance coverage is still very low, commercial annuity can be drifted away from the state’s basic old-age insurance coverage workers for the main target market and give full play to the commercial pension insurance supplementory role. Trust-based occupational pension is the accumulation of pension funds, the beneficiary in order to account for the accumulation of retirement funds to purchase a commercial annuity pension payments manner, it will mean that business in the future of occupational pension annuity market will be promising. At the same time, China’s rural areas for commercial annuity will provide a broad market, commercial annuity should give full play to their mobile, flexible, organizational strength, to strengthen research, and actively explore the rural old-age insurance market. Of course, China’s commercial pension market is not perfect, it is necessary to play the role of commercial annuity, it is necessary to actively promote the business development strategy annuity, annuity product development emphasis on design and actuarial pricing; vigorously strengthen the tax benefits of commercial annuity; to strengthen the pension risk management and insurance regulation.The development of commercial annuity must be based on preferential tax policies. China to build a multi-pillar old-age insurance system in the context of commercial annuity can not be separated from the development and strengthening of tax policies. Papers not in isolation of the taxation of commercial annuity, but the trust-based occupational pension, occupational pension and contract type on the annuity business of a unified framework to discuss the tax, with a view to a more macro conclusions. At present, it is imperative to implement the introduction of the commercial annuity revenue EET model of the company to provide group insurance to reduce or waive the sales tax, corporate income tax on insurance companies to adopt such measures as progressive tax rates.Papers came to the conclusion that the two important conclusions:First, different types of countries, both old-age insurance system reform, common features, there are country-specific characteristics; Second, there is no old-age insurance system for the best model, only the most desired of. Similarly, the current building and perfecting the system of old-age insurance system in nature, the fundamental problem is that a reasonable definition of government, business and personal boundaries, as soon as possible to build a true, multi-pillar old-age insurance system. In the multi-pillar system, the play of the inherent advantages of a commercial annuity, the policy of granting special concessions to vigorously promote the development of a commercial annuity, whether it is perfect for old-age insurance system in China, or are bigger and stronger commercial insurance benefit.