China 2011

China’s retirement income system comprises a basic pension consisting of a pooled account (from employer contributions) and individual accounts (from employee contributions). Supplementary plans are also provided by some major employers.

The following table shows China’s position when compared to the 15 other countries and some of the indicators that either scored relatively well or poorly

The overall index value for the Chinese system could be increased by:

• broadening the coverage of the national pension system
• introducing taxation incentives for employee contributions to the supplementary plans
• introducing a requirement that part of the supplementary retirement benefit must be taken as an income stream
• increasing the state pension age over time
• enabling individuals to retire gradually whilst receiving a part pension
• improving the level of communication required from pension plans to members

The Chinese index value increased slightly from 40.3 in 2010 to 42.5 in 2011 due primarily to recent decrees which improved the regulatory framework.