Circular of the State Council on Issuing the Implementation Plan for Transferring Part of State Capital to Enrich Social Security Funds

Circular of the State Council on Issuing the Implementation Plan for Transferring Part of State Capital to Enrich Social Security Funds

Guo Fa [2017] No.49

November 9, 2017

The people's governments of all provinces, autonomous regions and municipalities directly under the Central Government, all ministries and commissions of the State Council and all institutions directly under the State Council,

The Implementation Plan for Transferring Part of State Capital to Enrich Social Security Funds is hereby issued to you for careful implementation.

Implementation Plan for Transferring Part of State Capital to Enrich Social Security Funds

The Central Committee of the Communist Party of China and the State Council attach great importance to the construction of social security system. The institution of the unified basic old-age insurance system for enterprise employees in China, centering on the timely and full payment of the basic pensions due to the enterprise retirees, has had prominent effect by completing various tasks and has played an important role in building the socialist market economic system, maintaining the stable overall situation of reform and development and protecting the rights and interests of enterprise retirees, as a result of constant extension of the coverage and constant strengthening of the collection of funds, since its institution. While the basic endowment insurance funds for enterprise employees have a deficit, as affected by a number of factors, in the process of its gradual improvement. With the development of economy and society and the aging of population, the payment pressure of the basic endowment insurance fund is increasing constantly. In order to fully embody the intergenerational equity and share the fruits of the development of state-owned enterprises, part of the state-owned capital is hereby transferred to the social security fund, as decided under the specific scheme as set out below.

I. Guiding Ideology.
In accordance with the Guiding Opinions of the Central Committee of the Communist Party of China and the State Council on Deepening State-Owned Enterprise Reform and the relevant requirements of the basic endowment insurance system reform, part of the state-owned capital is transferred to the social security funds in order to enable all the people to share the development achievements of state-owned enterprises, improve the livelihood and welfare of the people, promote the reform and improvement of the basic endowment insurance system, realize the intergenerational equity and strengthen the sustainability of the system, for the thorough implementation of the spirit of the 19th National Congress of the Communist Party of China, in-depth implementation of the thoughts of the socialism with Chinese characteristics in a new age under the leadership of President Xi and careful implementation of the decisions and deployment of the Party Central Committee and the State Council.

II. Basic Principles
The transfer shall be oriented by the goal of the basic endowment insurance system reform at all times. Efforts shall be made to make the overall plans and take into consideration of all factors, with the appropriate support of public finance authority, for actuarial balance of the basic endowment insurance system reform, which is a systematic project. The basic goals of transferring part of state-owned capital are to make up for the deficit in basic endowment insurance fund for enterprise employees due to the implementation of the policy of deemed years of payment, and to promote the establishment of a more equitable and sustainable endowment insurance system.
The state-owned capital shall be transferred according to the systematic planning, in close combination with the goal of deepening the state-owned enterprise reform. The goal of transfer of part of state-owned capital, reason for deficit in the basic endowment insurance funds for enterprise employees, current status of state-owned capital and requirements of enterprise development shall be planned as a whole and be considered, for definition of scientific scope of transfer and determination of reasonable proportion of the capital to be transferred.
The state-owned capital shall be transferred for the goal of making up the deficit in the basic endowment insurance funds for enterprise employees from a long-term perspective.
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