Over 10 regions of China unveil cuts in social security programs

More than 10 provincial-level regions have unveiled their social security cut programs, andlocal governments said lowering the percentage will not affect employee's welfare andbenefits, chinanews.com reported on its website.

The report came six weeks after the State Council announced a plan to further reduce theburden on individuals and enterprises by cutting their payment to the social security funds.

According to a government routine meeting held on April 13, the required contribution rates ofthe pension insurance, unemployment insurance and housing provident funds will be loweredin a two-year period starting May 1.

Under the policy, enterprises that contribute more than 20 percent of the pension insurancepayment can reduce the rate to 20 percent, while those in provinces that see sufficient fundscan lower the rate to 19 percent. In addition, the rate of the unemployment insurance willrange between 1 percent and 1.5 percent, down from the previous 2 percent.

The website said more than 10 provincial-level regions have unveiled their social security cutprograms, including Shanghai, Chongqing, Sichuan, Xinjiang, Shanxi, Jiangxi, Shaanxi,Tianjin, Hubei, Henan, Shandong and Guangxi.

In terms of pension insurance, Shanghai lowered the rate that enterprises must pay forpension insurance to 20 percent from 21 percent, while Chongqing, Sichuan, Xinjiang,Shanxi, Tianjin, Hubei, Henan, and Guangxi reduced the rate to 19 percent from 20 percent.

In terms of unemployment insurance, Hubei, Shaanxi, Guangxi, Chongqing, Shanxi andJiangxi cut the amount of money that firms must pay for unemployment insurance to 1percent, while Henan reduced the rate to 1.5 percent from 2 percent.

Meanwhile, the amount that employees must pay for unemployment insurance was reducedto 0.3 percent of an employee's salary in Hubei and Henan, and 0.5 percent in Guangxi,Tianjin and Chongqing.

Besides pension and unemployment insurance, some local governments, such as Chongqingand Shanghai cut the percentage that enterprises must pay for medical insurance.

(CHINA DAILY)