an analysis for an equitable and sustainable welfare system

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  • An A

    nalysis for An Equitable

    and Sustainable Welfare System

    An Analysis for An Equitable and Sustainable Welfare System

    Gong Sen, Ge Yanfeng, Wang Xiongjun

    An Analysis for An Equitable and Sustainable Welfare System

    This report is a collaboration between UNDP China and the Development Research Center of the State Council. Special thanks go to the Royal Norwegian Embassy for the kind sponsorships.

    38.00

    ISBN 978-7-5001-4185-3

    China Translation & Publishing HouseEmpowered lives Resilient nations

  • An Analysis for An Equitable and Sustainable Welfare System

    Authors: Gong Sen, Ge Yanfeng, Wang Xiongjun

    Department of Social Development Research, Development Research Center of the State Council

    United Nations Development Programme

    China Translation & Publishing House

  • CIP =An Analysis for An Equitable and Sustainable Welfare System 2014:/.-- :, 2015.7ISBN 978-7-5001-4185-3

    I. II. . .C913.7

    CIP(2015)152789

    / /4 /(010)6835937668359827(010)68002494() /100044 /(010)68357870/book@ctph.com.cn /http://www.ctph.com.cn

    //

    / / /

    /1/16 /11.25 /170 /20158 /20158

    ISBN 978-7-5001-4185-3 38.00

  • ContentS

    Preface .......................................................................................................................................................................................................... 1

    Research team ........................................................................................................................................................................................... 3

    Executive summary ................................................................................................................................................................................. 4

    I.Research scope and key definitions ..............................................................................................................................................11

    (i) Definition and scope of social welfare ...............................................................................................................................11

    (ii) Definition of social welfare system integration and fragmentation ......................................................................11

    II.The current situation, causes and implications of the fragmentation and differentiation of the social welfare system ..................................................................................................................................13

    (i) The current situation of the fragmentation and differentiation of the social welfare system .......................13

    (ii) Causes and overall impact of a fragmented and differentiated social welfare system ...................................17

    III.International experiences and lessons for promoting the integration and coordination of the social welfare system .....................................................................................................................................21

    (i) There is a wide disparity between the starting points of social welfare systems, but looking at their development process, the models are gradually converging ...........................................21

    (ii) The integration of the social welfare system is an overall trend, as well as a commonplace experience of development, but paths of integration differ ................................22

    (iii) International experiences in universal educational systems and balanced development ..........................23

    (iv) Integration and coordination of the social welfare system is the mainstream, but it is influenced by complicated factors ....................................................................................................................24

    IV.Overall progress of the social welfare systems integration and local experiences in China ..................................26

    (i) Policies and experiences in facilitating system integration and balanced development of compulsory education ........................................................................................................26

    (ii) Progress and experience of the integration and sustainable construction of the healthcare system ......27

    (iii) Overall progress and local experience in integrating pension systems in China ............................................29

    (iv) Policy progress and experience of implementing minimum living allowance ................................................31

    V.Concepts and general principles regarding the integration and sustainable development of social welfare systems under new development circumstances .............................32

    (i) Basic concepts of social welfare system construction ...............................................................................................32

    (ii) General principles of social welfare system construction .......................................................................................33

    VI.Policy recommendations for building a social welfare system .........................................................................................35

    (i) Overall policy recommendations for building a social welfare system .................................................................35

    (ii) Specific policy recommendations for selected social welfare programmes .......................................................36

    Conclusion ................................................................................................................................................................................................40

    References .................................................................................................................................................................................................41

    Appendix A: Supplementary table to the main report .............................................................................................................43

    Appendix B: Supporting Report 1 ....................................................................................................................................................44

    Appendix C: Supporting Report 2 ................................................................................................................................................. 102

  • 1An

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    PrefACe Over the past three decades, especially ten years since the beginning of the new century, the social welfare system of China (more frequently referred to by the Chinese authorities as the livelihood support system but not here for the convenience of international comparison) has made significant progress. Such progress finds expression mainly in a basically complete set of welfare programs with roughly full coverage. However, despite its inclusiveness, the current welfare system features groups-specific design and region-specific implementa-tion, resulting in fragmentation and differentiation of both the overall system and its individual programs. To solve the problem of fragmentation, the Chinese government has taken the path of merging small pieces into big ones and transferring eligibility across pieces. To mitigate social conflicts caused by gaps between differ-ent groups, the Chinese government used to adopt an incremental approach, which attempted to satisfy not only the bottom group but also the top group. However, if the differentiation between regions and groups is maintained over the long run, the social strata will inevitably be strengthened and solidified; and the incremen-tal approach would not sustain in the context of a slower growth of budgetary revenues. In response to such a situation, the Research Department of Social Development under the Development Research Center of the State Council and UNDP established a research team with joint efforts to conduct in-depth and comprehensive research on the equality and sustainability of the welfare system in China.

    Over one and a half years from the launch of the project in late 2012 to the release of its research report in June 2014, the team invited experts from Norway and the Republic of Korea to conduct systematic research on the history and development pattern of welfare systems in Europe and East Asia. Their case study reports provided international experience which was of great importance to the research project. The research team also studied the history and current situation of the Chinese welfare system in general and visited Guangdong, Heilongjiang, and Gansu provinces for field research.

    After more than a year of efforts, the research team formed a policy advisory report entitled An Analysis for An Equitable and Sustainable Welfare System as well as a few supporting background reports. The advisory report, as stated in its title, proposed the option for equitable and sustainable development. To achieve equality, we have three options: the existing group-specific and unequal system, a system that is equal within each group, or a system equal to all. The last one is recommended here, that is, to adopt a fully integrated system design without differentiation by group. The major grounds for recommending this option are as follows: it has been proved by international experience that a system where all people belong to one single community can better ensure the interests of vulnerable groups and helps to forge consensus for reform. However, giv

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