China will extend its social security coverage to employees of private businesses, migrant workers and other groups, the top official in charge of social security said at a forum held in Beijing over the weekend.

"Covering a large number of people is one of the social security system's fundamental principals," said Tian Chengping, minister of labour and social security, at the first China Social Security Forum.

"Only broad coverage brings equality. Therefore, our mission that social security should cover more people is a priority," he said.

Under the new rules, the interests of migrant workers will get special attention.

Tian promised to make sure they get work injury insurance, and said the government would encourage them to participate in illness insurance and explore pension schemes for them.

The government also aims to provide employment, training and social security services to farmers who have lost their land.

However, such promises fall short of what is needed, according to Khalid Malik, who is the United Nations' resident co-ordinator in China.

"China has made a good beginning to set up a social security system," said Malik. "But the system needs to be extended to cover rural areas."

Malik urged the authorities to pay attention to the impact of increased labour mobility when it improves its social security system.

He said social services should be provided not only to migrant workers, but also to the families that they leave behind.

"The demand for reliable rural social security arrangements is growing just as the active rural labour force that can contribute to their financing is shrinking," he said.

And since women are disproportionately represented in the group remaining in the countryside, issues of social security in rural areas also have to take into account gender issues.

The pension policy today, according to Malik, also faces challenges from China's shifting demographics.

A recent World Bank paper indicated that the system dependency ratio, which means the number of old people as a proportion of those working, will increase rapidly over the next few years.

The UN suggests China use its general budget to subsidize pensions for the next group of retirees.

By the end of 2005, the total income of five social insurance funds for older people, those who are ill, the unemployed, those suffering from work-related injuries and pregnant women reached 696.8 billion yuan (US$87 billion). By last year there were 174.87 million old people and 106.48 million who were jobless.

Source: China Daily