By the end of last year, 22 million urban Chinese were living on the minimum government allowance. That figure accounted for nearly 6 percent of the nation's total urban population.

To support those people, the Chinese Government paid 15.1 billion yuan (US$1.83 billion) in minimum living allowances in 2003, according to official statistics.

This year the country plans to provide assistance for as many poor urban residents who meet the minimum living allowance criteria as possible.

"This means we will include all urban low-income residents in our social security net," says Wang Hui with the Civil Affairs Ministry.

China began issuing the minimum living allowance on a trial basis in 1993. Government allowances to needy urbanites started in 1999.

The program, as part of the whole social security net, plays an important role in maintaining social stability.

However, the minimum living allowance scheme is still a low-level security tool for low-income urbanites, as it was designed only to help them meet the basic needs for food and clothes.

Healthcare, housing and education are all out of its reach.

Need for better medicare

A research report from the Civil Affairs Ministry shows low-income families usually don't see doctors even when they fall sick. Children's education is also a heavy burden for them, as is proper nutrition.

Furthermore, statistics from the ministry suggest diseases have caused over 30 percent of low-income residents to live in poverty.

And some low-income residents have to pay medical treatment fees with some or all of their minimum living allowance.

All these factors have greatly reduced their standard of living.

In fact, the lack of medical aid among low-income city residents has been the bottleneck to the country's urban anti-poverty system.

As China continues its rapid economic expansion, the income gap among urbanites continues to widen.

In the first nine months of last year, the per capita income of the country's top earners, who account for 20 percent of the urban population, posted a year-on-year increase of 12.4 percent to reach 13,120 yuan (US$1,590), according to data from the National Bureau of Statistics.

In contrast, the per capita income of low-income urban residents, who also make up 20 percent of urbanites, edged up by 8.3 percent year-on-year to 2,433 yuan (US$295) in the same period.

But with the commercialization of healthcare, the cost of medical treatment in cities is more than most residents can afford.

Call for attention

There are four aspects that need special attention in the government's campaign to fight urban poverty.

First, the poverty condition is much too severe. Many families' monthly income is below 600 yuan (US$72). Second, poverty-stricken people's health usually is below average.

Third, low-income residents seldom purchase medical insurance. If they fall ill, their family could end up bankrupt.

Finally, healthcare appears to be a more pressing problem than housing or education for low-income people.

A positive sign, however, is that Shanghai and some cities in south China's Guangdong Province are examining the feasibility of an urban healthcare network.

"But there is still a long way ahead because medical aid covers a broad area, including how to define the benefit package, design the medical aid scheme and manage the funding," says Wang.

Moreover, the limited fund still cannot meet all the needs.

But governments at all levels have begun to place emphasis on the issue.

The Civil Affairs Ministry will soon introduce its medical aid program nationwide as part of its urban anti-poverty system, according to Wang.

Two months ago, the ministry set up its minimum living allowance department.

The central government's budget for minimum living allowance is 9.2 billion yuan (US$1.1 billion) this year.

And the total budget will reach 20 billion yuan (US$2.4 billion) if funding from local governments is included.

"All these measures demonstrate the central government's care for poverty-stricken urban people," Wang says.

(China Daily April 28, 2004)