From Individual Account to Individual Pension: Rethinking of Structural Reform of Basic Pension Insurance for Urban and Rural Residents
Individual account of basic pension insurance for urban and rural residents has made remarkable achievements in expanding coverage. But there are also some practical problems in the system in the past ten years.Firstly,the system model of combining individual account with social pool and progressive subsidy mechanism seriously affects social equity. Secondly,individual account show loss of efficiency in terms of financing level,rate of return and pension level. Thirdly,the management level of individual account management is low,which aggravated the responsibility and financial burden of local governments. In theory,basic pension insurance or urban and rural residents is mixed system and combining individual account with social pool combines public pension with private pension substantively,however,neither of two parts is social insurance. Voluntary system design focuses on incentive,but the participation depth of this system is very low due to the unclear property rights of individual accounts and the loss of yield advantage. This paper holds the opinion that we should separate individual account from social pool,and establish an independent public pension system. Meanwhile,we should reform the individual accounts into the third pillar of individual pension system,in which individuals voluntarily participate. In addition,we should also take mutual assistance of family members as a formal system into the individual pension.