Study On The Contribution Level Of Occupational Pension

The paper focuses on the research of occupational pension contribution level, including the designation and the specific value. The regulation of occupational pension contribution rate is not very specific and only has an upper limit. The research aims to shrink the range or make a specific contribution rate.After the introduction of the theories of occupational pension and the development of occupational pension in China, the paper analyzes the factors that impact the contribution rate. On the base of assumption of"economic person", the theoretical analysis finds that the company can get its biggest profit and the personal can achieve his biggest utility. Then the paper gets the conclusions as follows: 1.contribution rate n depends on the working years T and discount rate of future incomeξ.2.contribution rate n and the on-job years T has a minus relationship, namely, when n become lager , T will become smaller. The contribution rate n has the same relationship with N which stands for the pension that was awarded to the employer when he was retired.To the specific contribution level, the paper makes a positive analysis from the point of view of the company and the employee. The occupational pension which is retained profits in fact comes from the optional accumulation fund in the company. According to the draw rate of the optional accumulation fund we can conclude that the companies can afford the occupational pension for the employees on average. The contribution rate is not very high and can't reach 8%. The maximization rate is about 4% and the average rate is 3.85% over the years.The occupational pension comes from the residual disposable income after deducting the costs for the employee. The study result suggests that the employees have the ability to take part in the occupational pension plan on national average level. The contribution rate is below 4%. The average rate is 3% over years. But in the developed provinces, for example, in Jiangsu province, employees have strong economic ability to bear occupational pension and the rate is near 8%. The average contribution rate is 6%.The paper calculates the real needed contribution rate by Actuarial Model under the premise of objective substitution rate. The conclusion is that the contribution rate is about 4.35% and it is related to the age of beginning work, the retiring age and the pension yield.On the basis of the above analysis the paper concludes that the proper contribution rate is bout 3%.