A Study On Security Level Of Urban And Rural Residents’ Endowment Insurance System Of Changsha

With China’s population aging and urbanization accelerating, on February 21th 2014, the State Council issued a document on guidance on establishing a uniform basic endowment insurance system for urban and rural residents, decided to combine the new rural endowment insurance system and urban endowment insurance system, and established uniform urban and rural residents’endowment insurance system (URREIS) in the whole country. Early in July 2010, Changsha carried out uniform URREIS. However, URREIS in Changsha has been facing the problem of low actual pension level since its implementation. Low pension level of URREIS can directly impact the life quality of people insured in old age, making it difficult to guarantee the elders’basic living needs. Analyzing the reasons for low pension level of URREIS in Changsha and how to improve pension level makes great significance on promoting the development of URREIS.First of all, this thesis, taking Changsha for example, based on the related theories and research results of Professor Mu Huaizhong, on one hand builds the model of measuring moderate pension level from demand perspective, on the other hand establishes the actuarial model of supply pension level from supply perspective. Secondly, based on data from 2010 to 2013, we measure moderate pension level of URREIS in Changsha and forecast it from 2014 to 2030. Based on reasonable actuarial assumptions, we measure supply level of pension. By comparing the two kinds of pension, we find that the pension level that URREIS provides theoretically can’t guarantee the elders’basic living from 2013 to 2030. Finally, we simulate policy reform by adjusting actuarial parameters. Simulation result shows that under the condition of introducing payment growth rate and payment subsidy rate parameter, and increasing level of fund returns and basis pension adjustment coefficient progressively, URREIS in Changsha can achieve the goal of guaranteeing the elders’ basic living at different levels in 2030. Thus, this thesis suggests the following four steps to improve security level of URREIS:establishing payment rate mechanism linked with income level, increasing level of fund returns, building a reasonable basis pension adjustment mechanism and improving the payment subsidy mechanism.In this thesis, we establish the pension security level of URREIS from both demand and supply perspective, and analyze whether the current URREIS can achieve the goal of guaranteeing the elders’basic living based on actuarial principles, which expands research perspective of this field. We provide some viable suggestions to improve security level of URREIS by designing and running policy simulation program schemes, which enriches empirical research of this field.