Thank you, Mr. Chen. The floor is now open for questions.
We see that this time the social security contribution reduction policy is very strong in scale and scope, and also has differentiated measures for different types of enterprises. What is the objective behind it?
This phase of social security reduction is a special measure we have taken to deal with the emergency caused by the epidemic. It is for the first time in the history of social security in China. We took the following aspects into our consideration:
First, it should be strictly in accordance with the law. According to the Social Insurance Law of the People's Republic of China, social insurance premiums “shall not be deferred or reduced unless it's for legal reasons such as force majeure”, and in the event of a major outbreak, measures to reduce social insurance premiums are to be taken in accordance with the law.
Second, we would make the maximum effort to help enterprises tide over the difficulties and resume production, support stability and expand employment. In the course of our study, we compared different kinds of programs. After comprehensive analysis, we came to the conclusion that a phased reduction of social insurance premiums is more direct, targeted and effective. Affected by the epidemic, enterprises will face a relatively bigger challenge in the first half of this year. Giving more concentrated support though the reduction of social security contributions is in line with the needs of enterprises, the expectations of the people and the goal of the government. According to preliminary estimates, we predict that this phase of relief will reduce three social security contributions by enterprises by more than 500 billion yuan, which is more than last year's 400 billion yuan. At the same time, we have also fully considered the operation of the funds. We will implement more measures such as improvement of provincial coordination, increasing the scale of fund transfer and other measures to ensure that social security benefits are paid in full and on time.
Third, we have rolled out differentiated policies for different enterprises. Micro enterprises and SMEs are the main force of China's economic development, accounting for more than 99 percent of the total number of enterprises, and they are also the main channel to provide jobs. But their risk resilience is weak. Greater support for micro enterprises and SMEs can alleviate their burdens, helping them survive and develop, as well as stabilize and expand employment. Large enterprises are more resilient to risks. However, due to the impact of the epidemic, their production and business activities have also encountered difficulties. Halving their social insurance premiums can play a positive role in their resumption of production. Geographically, Hubei Province has the most serious outbreak and its enterprises are also the most affected. Strengthening the relief policies and giving special care and support to enterprises in Hubei will help them to better tide over the difficulties.
Fourth, a combined policy of reduction and delayed payment of insurance premiums will be carried out. In difficult times, we should make best use of the social security support policy. While the relief policy is implemented, enterprises with serious difficulties in production and operation due to the epidemic may also apply for suspension of payment, which can further alleviate their operational pressure.
Since the social security system was established, thanks to the great importance attached to it by the CPC Central Committee and the rapid economic growth, a basic framework of a social insurance system covering all the people have been established and attained a solid foundation. In the critical moment of a major public health emergency, the social insurance system is to give full play to its role of absorbing social shocks and acting as a safety net for people's livelihood. It should not only safeguard the basic needs of people, but also support economic development and stability and promote employment. It is time for the system to display its advantages. Only by ensuring the stable operation of enterprises can stable employment be guaranteed, thus forming a virtuous circle of enterprise development and social security development to promote the sustained and healthy development of the economy and social harmony and stability. Thank you.