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People’s Daily: China’s Social Security Consumes 40% of Wages

People’s Daily recently reported that, according to the Ministry of Human Resources and Social Security, the current five pre-tax payment items in the social security account take 40% of a normal taxpayer’s wages. This indicator ranks number one out of all 181 countries. It is 3 times the level of the five Northern European countries, 2.8 times the level of the G7 countries, and 4.8 times the level of the East Asian countries. Meanwhile the current social security funds have a shortfall of a total of RMB 1.76 trillion. A survey was conducted on the recent plan to extend the retirement age. Of those surveyed, 93.9% opposed the plan. Only 2.4% of the people supported it. The  People’s Daily Network conducted the survey. The report ended by calling for major reform of the current social security system and the establishment of a retirement management option like the 401K model in the United States.
Source: People’s Daily, June 15, 2012