On 21 Apr. 2022, the General Office of the State Council issued the “Opinions on Promoting the Development of Private Pensions” (《關于推動個人養老金發展的意見》, hereinafter referred to as the “Opinions”).
According to the Opinions, workers who participate in the basic pension insurance for urban employees or the basic pension insurance for urban and rural residents in China can participate in the personal pension scheme.
That is to say, individuals can make voluntary contributions to their private pensions as a supplement to basic pension insurance.
The contributions are deposited into individual pension accounts. Annual contributions, totally borne by the participant, are capped at CNY 12,000.
The new private pension scheme is rolled out to tackle the issues of an aging society. As China is facing the rapid graying of its population, the previous pension system may not suffice to meet future pension needs.
Cover Photo by Lavinia Occeña on Unsplash
Contributors: CJO Staff Contributors Team
