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Minimum Standard of Living System in China: An Interview

A minimum standard of living system established nationwide in 1993 is considered the basic safety net of China’s social security system. How is it being implemented today? Is it working in poor areas? Do local governments have the wherewithal to support it? How? Can the present system help the urban poor shake off poverty? These and other questions were asked recently by china.org.cn to Wang Zhikun, director of the Social Relief Office, Disaster and Social Relief Department of the Ministry of Civil Affairs.

china.org.cn: What is the minimum standard of living system? How is it implemented today in China? Is it in both big and medium-sized cities?

Wang Zhikun: The minimum standard of living system for city residents is a new social relief system designed to provide help according to a set minimum standard of living level. It serves as the most basic safety net of China’s social security system and is considered a reform and development of China’s old social relief system.

In 1993, Shanghai took the lead by setting up its minimum standard of living system for city residents. In September 1997, the State Council sent out a notice requiring establishment of similar systems in all cities of the nation. By the end of 1999, a minimum standard of living system had been established in the 667 cities of different sizes and the 1,682 county seats across the nation. Up to the present, the system has expanded to the non-agricultural population in many areas. By spring of 2001, some 4,160,000 persons were benefiting from the minimum standard of living system, with an average monthly allowance of 60 yuan (US$7.3) per person.

china.org.cn: What is China’s minimum standard of living? What are highest and lowest standards? How is the gap between the standards and real life bridged? How are differences among people under the standards identified and treated? What about regional differences?

Wang Zhikun: As a system implemented throughout the whole country, the minimum standard of living system must have uniform requirements in its basic principles, implementation, funding resources and the administrative system. Because of the wide gaps between west and east China and consumption levels in cities of different sizes, the central government can only formulate general principles for a minimum standard of living. The actual standards are left to local governments to decide based on local realities. According to the Regulations of Minimum Standard of Living for City Residents came into effect on October 1, 1999, the standard is determined by civil affairs departments of municipal and county governments in line with the local costs of basic necessities like clothes, food and housing. The cost of water, electric and heat, in addition with tuition for the compulsory education of minors should also be taken into account. We can see from this regulation that the minimum standard of living for city residents is the most basic safety net and the lowest standard of social security system to support fundamental life of city residents.

The minimum standard of living differs greatly among different cities and counties of the country. Even in cities and counties within a province or autonomous region, the standards are not the same. In general, standards in Beijing, Shanghai and Guangdong are comparatively high, with Shenzhen the highest 319 yuan (US$38.6) per person, per month). The regions with the lowest standards include Guizhou, Jiangxi provinces and Inner Mongolia Autonomous Region. The lowest standard, which is 78 yuan (US$9.4) per person, per month, is in Qianxi County in Guizhou Province.

Whether a family should receive the minimum living allowance is decided by the average income of the family members and the actual living level of the family. If the average income of a family is below the local minimum standard of living and its actual living level is not apparently above the average local level, it should be granted the minimum living allowance.

Some cities, such as Fuzhou and Xiamen, decide the standard according to the number of family members. A family having a single member enjoys the highest allowance, two members the next, and those having three or more members even lower. Some cities offer a special allowance that is 20 percent higher than the uniform standard for widows and orphans.

The minimum living allowance is the difference between the average family income and local minimum standard of living. For instance, if the average monthly income of a 3-member family is 170 yuan (US$20.6), and the local minimum living standard is 200 yuan (US$24.2), the family should receive a monthly allowance of 90 yuan (US$10.9).

What’s more, some local governments provide people who receive the minimum living allowance with aid in kind as they issue them the allowance. For example, in Beijing, those who get the minimum living allowance also get a card with a face value of 40 yuan (US$4.8) when they draw the 280 yuan (US$33.9) allowance. The holder of this card can use it to pick up food and oil in an assigned food store.

china.org.cn: Does the minimum standard of living system function in poor areas of the country? If it does, how can local governments afford to support the implementation of the system?

Wang Zhikun: As I have said, the minimum standard of living system functions in every city and county seat around the country. Unfortunately, in some poor areas, the local financial departments do find it difficult to support the system. To date, these local governments are adjusting the structure of their financial expenditure to invest more in social security including minimum standard of living system. At the same time, the central government invests more in central and western China to help the local governments establish and improve their social security system.

china.org.cn: Who is in charge of the implementation of the minimum standard of living system? To let the allowance go to the terminal receive, what procedures are needed?

Wang Zhikun: According to the Regulations of Minimum Standard of Living for City Residents, local governments are responsible for the implementation of the minimum standard of living system. To be more specific, departments of civil affairs in governments of provincial and municipal level are responsible for the administration of the minimum standard of living system within their own administrative regions. Financial departments are responsible for the collection of security fund. Departments of statistics, price, auditing, labor and social security, and personnel are responsible for the related work. The Ministry of Civil Affairs is in charge of administration of the national minimum standard of living system for city residents.

The major procedures involved in minimum standard of living system include application, affirmation, ratification, receiving, change and adjustment.

china.org.cn: Are all the persons eligible under the minimum standard of living receiving benefits? Can the existing social security system help impoverished city residents shake off poverty?

Wang Zhikun: Although China has set up the minimum standard of living system, we still have a long way to run. There are people under living under the standard who do not yet receive benefits. According to an investigation done jointly by local civil affairs departments, there are some 14,000,000 impoverished city residents in the nation. However, up to the end of the first season of this year, only some 4,160,000, enjoys the minimum standard of living allowance. That leaves some 10,000,000 impoverished people outside the system. There are three reasons for this: inadequacy of local funds; inadequacy in our work, and prejudice against the system and people who receive the allowance.

The minimum standard of living system can only provide basic living needs for city residents. It cannot get them out of poverty. The way for impoverished city residents to improve their condition is to find employment. Sure, the social security system can be helpful and beneficial in this respect.

china.org.cn: Who are the impoverished city residents in today’s China?

Wang Zhikun: At present, aside from those people who traditionally have received help (those who have no income, no ability to work, or no legal supporters), there are three sorts of impoverished families: a family in which its main breadwinner has been laid-off, a family with disabled people or people who are ill and needing to pay high fees for medical care, and a family that lacks a working person or which has a student needing to pay a high tuition.

china.org.cn: Could you tell us something about the situation of minimum standard of living system in rural areas?

Wang Zhikun: The establishment of a minimum standard of living system in rural China involved many regions. Statistics reveals that 29 provinces and autonomous regions by the end of 2000 had launched the system, and 14 had completed the work of setting it up. More than 3,000,000 rural people have enjoyed the minimum living allowance. The allowance totaled 730,000,000 yuan (US$88,302,891), with about half of it financial investment from government, and the other half a collective fund.

Compared with the system for city residents, the minimum standard of living system in rural areas is quite different in content, method, criteria, duration, and funding resources. The family income is computed by the year, and the criteria is also drawn up with a year as the unit.

The establishment of minimum standard of living system in rural areas means that the previous temporary relief by both the government and collectives has changed into a standard social relief system. A gap between richer regions and poorer regions still exists in the establishment of rural minimum standard of living system.

The Ministry of Civil Affairs will strengthen its guidance to the work of minimum standard of living system to improve the existing systems and help those regions without the system to set up their own ones.

(china.org.cn, 08/14/2001)

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