The Financial Street Forum 2024 is being held from October 18 to 20 in Beijing. On the second day of the forum, a parallel session titled “Propelling High-Quality Development of Pension Finance: Global Progress and China’s Opportunities” focused on the three pillars of China’s pension system: the public scheme, as well as the enterprise and private schemes.
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The first pillar of China’s pension system is the basic pension system, which covers urban employees, as well as urban and rural residents. Led by the government, the compulsory pension scheme is to provide basic pension security for insured persons after retirement.
By the end of 2023, the basic pension system had covered 1.07 billion people, with accumulated balance of basic pension insurance funds at 7.82 trillion yuan ($1.1 trillion). It is the largest social security system in the world.
The second pillar includes the voluntary pension plan for corporate employees and occupational pension plan for government employees. The schemes are to increase disposable income of insured persons after retirement.
Established in 2004, the voluntary corporate scheme had covered 141,728 enterprises and 31.44 million corporate employees by the end of 2023. Meanwhile, the balance of employee pension funds had reached 3.19 trillion yuan.
Established in 2014, the occupational pension plan for government employees is compulsory. By the end of 2023, the operating investment scale of the scheme had risen to 2.56 trillion yuan.
The third pillar involves the voluntary private pension scheme. China launched the pilot phase of the scheme in November 2022. As of September 2024, there had been 103 private pension insurance products. As of June 2024, Over 60 million people had opened private pension accounts.
