Provision of Social

Welfare
Challenges to Governance
Context (Evolution of China’s social policy)
Before Market Reforms
- China’s welfare provision was based on the planned economy model.
- Urban: work units (danweis)
- Rural: communes

1980s-1990s (Start of market reforms)

- Remove barriers to labour mobility + maintain competitiveness of the national
economy
- Remove problems associated with the planned economy: excessive egalitarianism
and ‘iron rice bowl’.
- Examples: liberalisation of hukuo-linked employment, little labour protection
legislation, reduce social benefits.
Context (Evolution of China’s social policy)
2000s
- Increased state intervention: efficiency and equality
- Address widening inequality
- Example: Increase public spending on education and healthcare

Currently
- Too many reforms too soon/ Lessons learnt from GFC (failure of welfare states)
- State to retreat a little. People to be more active contributors.
- Social investment rather than social consumption
Traditional social security system in China
Employees of state organs and public institutions
enjoyed retirement security, free medical care,
compensation for industrial injury and maternity
State provision protection, state relief, state welfare, support to
servicemen, price subsidies, subsidised or free housing
and education, etc.

Employees of enterprises enjoy labour insurance

Traditional
(covering retirement, medical expenses, industrial injury,
system
Enterprise provision maternity leave, etc.), welfare benefits, living allowances
for poor households, etc.

Farmers enjoy co-operative medical care, collective

relief, etc.; infirm or childless elderly people are provided
Rural collective
for in major aspects of life; families of servicemen enjoy
provision
preferential treatment, etc.
Market Reform
- China had to build a social welfare system that cater to the
characteristics of market economies: unemployment benefits,
health insurance, work injury cover, maternity support and old-age
retirement incomes.
- Since the 1990s, the Chinese Government has taken numerous
steps to revamp the social security system in the following five areas:
poverty reduction, old-age support, education, medical care and
housing.
Building a social welfare system
The general concept of social policy did not appear in a high-level policy document
until 2006, in a Central Committee resolution on “building a socialist harmonious
society”.
At the 18th National Party Congress in 2012, Hu again stressed the importance of
social development, the key objective being to guarantee and improve people’s
livelihoods and to satisfy their increasing material and cultural needs.
Xi Jinping as the newly elected General Secretary of the CCP in 2012, articulated
providing a good life for the people as the Party’s overall goal.
Pillars of China’s welfare system
(lecture notes 2.4)
1) Social assistance
 Example: poverty relief – provision of the Minimum Subsistence Guarantee (urban
residents been covered since 1999 and rural residents since 2008)
 The relief is managed and funded by local governments.
2) Social insurance
 Five categories of social insurance: pensions, medical, work injury, unemployment
and maternity.
3) Welfare services
 Services provided to disadvantaged groups such as orphans and the disabled.
Watch on Youtube: Learn Chinese social welfare system in 4
minutes subtitled in English

https://www.youtube.com/watch?v=Ip0jRj18BX0
Improvements made to
China’s social welfare
provisions
Expanding Social Safety Net
• Dibao (低保) - Urban Minimum Living Guarantee System (最低生活保障，简称“低
保”, abbreviated as Dibao) system
• The social safety net reforming originated in Shanghai in 1993.
• According to the Dibao regulations, whether or not the poor have the ability to work,
no matter what their value is, whatever the cause leads to poverty, all of them can get
supports from government.
• In 1999, the Regulations on Minimum Subsistence for Urban Residents was issued
and this institution was implemented in all urban areas in China.
• In 2007, China established the rural Dibao, that marked that a social safety net
covering all peoples.
 Increasing types of social assistance
Types Description
Education Assistance In 2014, Interim Measure for Social Assistance (《社会救助暂行办 法》) was promulgated and
educational assistance became a national policy. The State should provide educational
assistance to students in the compulsory education attendance stage who are the members of
families covered by Dibao and low-income families. According to the needs of different stages of
education, the government supports the student such as reducing or exempting tuition fees,
granting aid and providing living allowance to ensure that students’ basic needs in life and study
can be met.
Housing Assistance In 2014, the Interim Measure for Social Assistance was released and the housing assistance
system became a nationwide policy, it requests the local governments to provide assistance to
Dibao and lowincome families. Local government give priority to allocate the public rental
housing, grant rental subsides for the low-income families in housing difficulties in urban areas,
and give priority to include them into the project to renovate dilapidated houses and renovate
their houses as early as possible in rural areas.
Disabilities Assistance In 2015,Opinions of the State Council on Establishing a Attendant System of Living Subsidies for
Disabled Persons with Financial Difficulties and Nursing Subsidies and Living Subsidies for
Persons with Disabilities came into effect. It was the first national subsidy programs for persons
with disabilities. In 2018, a rehabilitation assistance system was established which was designed
to provide rehabilitation support such for operations, assistive devices and rehabilitation
training for children with disabilities.
Read the UN report on China’s social
assistance reform
https://www.un.org/development/desa/dspd/wp-
content/uploads/sites/22/2018/06/The-Social-Assistance-Reform-in-China.pdf
 China’s social security system at a glance

https://www.china-briefing.com/news/chinas-social-security-system-2/
Assessment
Watch again: Qin Gao: Dibao or "Minimum
Livelihood Guarantee" in China
https://www.youtube.com/watch?v=nEQtjzuax0o
Fight Against Poverty
Watch UNDP Video on China’s fight against poverty:

Universal Basic Income: a Potential Policy Option for China?

https://www.youtube.com/watch?v=CnK1N8Vtxiw&list=PLj-
oe6mSUS7jfBgMqCDumga4MnCj2mFGu
Observations
Access is moving towards near but not fully universal
The 2010 Social Insurance Law carefully envisages wide coverage. The main
remaining and unresolved exclusion is of migrant workers, perhaps up to 250 million
people.
The self-employed and irregular workers may not participate in social insurance
because they have to pay contributions. Even where participation is legally
compulsory, as it is for most enterprise workers, there is widespread non-compliance
and many enterprises fail to sign up.
Observations
Access is inadequate and not uniform
The level of support is generally inadequate for protection against poverty, provisions
are often poorly managed.
In social insurance, there are regional and occupational variations in provisions,
including between government and enterprise employees and urban and rural
residents.
Observations
Central-Local distortions
The central government’s intentions may be locally mismanaged, ignored or
sabotaged.
They can decide on the degree of inclusion or exclusion of migrant workers. They
hold power over social insurance capital and have the power to divert these funds to
uses of their own.
Local authorities also have the power to disregard national social security provisions .
One example is in schooling. Although compulsory education is in principle free,
schools and local authorities widely impose implicit fees on parents. Local authorities
also have the power to disregard national social security provisions .
Observations
New challenges
 Aging population
 Slowing economic development
 changes to employment structure – technology replacing humans
 What are the key
challenges facing social
welfare provision in China?
1)Hukuo System
2)Local Governments
3) New challenges emerging
Watch Youtube: Fred Teng discusses China's
social welfare
https://www.youtube.com/watch?v=yDO9rMOcRog
READ

https://www.caixinglobal.com/2018-08-27/chinas-social-security-balancing-act-
101319007.html
China Healthcare
Watch Youtube: World Bank – What’s Ailing
China’s Health System?
https://www.youtube.com/watch?v=huHSQ3A5sH8
READ

https://chinapower.csis.org/china-health-care-quality/#toc-0
Watch Youtube: Closer to China with R.L.Kuhn—
Healthcare Reform In China 08/14/2016 | CCTV
https://www.youtube.com/watch?v=OhTml1CR4VA
China Education
Read the Review by China’s MOE
http://en.moe.gov.cn/News/Top_News/201801/t20180
130_326023.html
Read this journal article:
Impacts of reforms in Chinese Educational
System (published 2017)
http://www.macrothink.org/journal/index.php/ije/articl
e/viewFile/10495/8733
Watch youtube: CHINA: Migrant workers' children face
unequal education opportunities
https://www.youtube.com/watch?v=Zn18V4MSb-Y
Co-governance:
Non-Profit/Govt
Organisations
The role of the civil society
Central government officials have been pushing an “open up”
policy for social organizations for years.
Examples:
Wang Zhenyao, former director of the Ministry of Civil Affairs’ Disaster Alleviation
Office, led the establishment of the Social Welfare and Philanthropy Promotion Office
in that ministry in 2008. The same year, he said a ministry goal was to build an
advanced social service system and facilitate grassroots philanthropy.
On July 4, 2011, Li Liguo, the head of the Ministry of Civil Affairs, announced that
charity, social welfare, and social service organizations would be permitted to register
directly at local civil affairs agencies. The announcement is seen as a step toward the
abolishment of the dual administration system. It means that millions of unregistered
grassroots nonprofits will have a greater chance to register as legal nonprofit entities.
Example
China’s Project Hope is a civil undertaking of social welfare program,
sponsored and carried out by China Youth Development Foundation
(CYDF). The welfare project aims at aiding those children who are unable
to go to school because their families are poor. Project Hope has been a
most important civil undertaking of public welfare, the CYDF, which
sponsors the activity, has become the largest civil public welfare
organization in China.
http://www.chinacsrmap.org/index_EN.asp
Summary
Key Points
1. Why is social welfare provision an important aspect of good governance in China
today?
2. What have been and are the efforts made by the Chinese government made in the
provision of social welfare? How would you assess these efforts?
3. What are the challenges faced by the Chinese government in meeting the social
needs of the people?
4. What is the possibility of overcoming these challenges? What are some policy
improvements/strategies can you recommend to the government to overcome
these challenges?
https://cpianalysis.org/2017/03/31/2017-national-peoples-
congress-and-chinas-social-policy-priorities/