Managing across levels of government: The challenge of pension reform in China

Abstract

The People’s Republic of China is facing a “population ageing tsunami”, with the share of the population aged over 65 expected to double between 2010 and 2030. Reforming the social security system to improve coverage, sustainability and equity is an urgent task for the government. This chapter examines the workings of the Urban Employee Scheme (UES), the main pension programme currently covering more than 400 million workers and retirees. Although nominally a national programme, the UES is a patchwork of pension pools, managed mostly at the city and county levels. Under fragmented management and weak oversight, the system is rife with underpayment and evasion and has stymied previous efforts..