Focus on the 14th consecutive increase of pension funds | Changchun Free Consultation Lawyer

Recently, the Ministry of Human Resources and Social Security and the Ministry of Finance jointly issued the "Notice on Adjusting the Basic Pension for Retirees in 2018", which clarifies that from January 1, 2018, the pension for retirees in enterprises, government agencies and institutions will be increased by about 5% of the overall level. It is expected that 114 million retirees will benefit from this. Changchun Free Consultation Lawyer

How to determine the increase in price

From 2005 to 2017, China has continuously increased the basic pension for enterprise retirees for 13 years, raising the average monthly basic pension for enterprise retirees from over 700 yuan to around 2500 yuan in 2017. Among them, in 2016 and 2017, unified arrangements and synchronous adjustments were made to the basic pension of retired personnel in enterprises, government agencies and institutions. Changchun Free Consultation Lawyer

Jin Weigang, President of the Chinese Academy of Labor and Social Security Sciences, said that the overall adjustment level of about 5% this time is a cautious decision made by the country to continuously meet the growing needs of the people for a better life, while taking into account the long-term sustainable development of the pension insurance system. The level of pension adjustment is mainly determined based on factors such as average wage growth, price increases, and fund support capacity.

From the actual situation, after years of reform and opening up, China's economic development has entered a new normal, shifting from a high-speed growth stage to a high-quality development stage. The economic growth rate has slowed down, the average wage increase of employees has remained stable, and the price increase is slightly lower than the same period last year. At the same time, the number of people receiving basic pension continues to increase, coupled with the accelerated development of population aging, the dependency ratio between the number of contributors and the number of recipients of benefits continues to decline, and the burden of pension is becoming heavier, leading to increasing pressure on the income and expenditure of pension insurance funds.

Adjusting the treatment of retirees by around 5% and appropriately slowing down the growth rate of pension funds, we will do our best and act within our capabilities. On the basis of ensuring the basic livelihood of retirees, we have realized that the majority of retirees can appropriately share the fruits of economic and social development, which is conducive to better safeguarding the long-term rights and interests of retirees, making people's sense of gain, happiness, and security more fulfilling, secure, and sustainable, "said Jin Weigang.

Pay more, pay longer, pay more

Wei Gang emphasized that the adjustment level of "around 5%" is the overall per capita level of adjustment for the treatment of all retired personnel in enterprises and government institutions. It is not based on the per capita pension level of retired personnel in enterprises and government institutions, and is not adjusted according to a 5% ratio, nor is it an increase of 5% for every retired personnel.

Firstly, this year's adjustment will continue to adhere to the principle of "merging tracks", and the adjustment methods will be basically the same as in 2016 and 2017. Enterprises, government agencies, and institutions will implement a unified adjustment method that combines "quota adjustment, linkage adjustment, and appropriate tilt": quota adjustment reflects social equity, and the adjustment standards for all types of retirees in the same region are basically the same; The linkage adjustment reflects the incentive mechanism of "more contributions, more rewards" and "long-term contributions, more rewards", so that personnel who pay more and long-term contributions while working can receive more pension benefits; Appropriately tilt to reflect key care, mainly to take care of groups such as elderly retirees and retirees from remote and difficult areas. This adjustment method can appropriately adjust the income gap among retirees, reflecting the principle of redistribution that pays more attention to fairness, "said Jin Weigang.

At the same time, due to differences in economic development levels and the basic situation of retirees in different regions, there may be certain differences in the specific adjustment methods between regions and between enterprises and government institutions. Specifically for each retired individual, due to differences in payment years and pension levels, there may be certain variations in the actual adjustment level. Generally speaking, individuals who have a long payment history and a high level of payment wages while employed will also have a relatively higher increase in their basic pension amount.

The adjustment period will start from January 1, 2018, "said Jin Weigang. Due to differences in local conditions, the timing of adjusting pension payments may vary, but overall, the increased pension will be distributed to retirees as soon as possible. Changchun Free Consultation Lawyer

Multiple measures taken to cope with the pressure of pension payments

Chu Fuling, director of the Social Security Research Center at the Central University of Finance and Economics, pointed out that in order to cope with the pressure of future pension payments, the country has taken various measures: firstly, it has established a national social security strategic reserve fund with a current market value of 2 trillion yuan, which can be used to supplement the basic pension insurance fund for employees in the future to alleviate the pressure of pension payments caused by aging; Secondly, an investment mechanism for the basic pension insurance fund for employees has been established, striving to achieve the preservation and appreciation of the pension insurance fund; Thirdly, allocate a portion of state-owned capital to compensate for the transformation costs of pension insurance for the elderly and middle-aged; The fourth is that governments at all levels shall bear the responsibility of providing timely and full payment of pension funds in accordance with the law, and enhance the credibility of the system. In short, the framework of China's pension insurance system is becoming increasingly perfect, and the operation of the pension insurance fund is generally stable. Through deepening reforms and taking multiple measures, the sustainable and healthy development of China's pension insurance industry can be achieved, "said Chu Fuling.