Pension Reform in China: Meeting the Challenges Posed by Societal Aging

China's public pension system now consists of an urban social pension scheme and a new rural social pension scheme, both pilots, in addition to the existing urban workers' basic pension, public service workers' pension, and rural pension schemes. Nevertheless, there are still many unresolved issues and considerable scope for improvement. First, coverage is still low. Second, there exists wide discrepancy in benefit levels between the different pension schemes. Third, there is a lack of pension portability as a result of the fact that each urban area tends to administer its own pension scheme. Finally, as societal aging accelerates and people live longer, the number of those in work and making contributions will decline while the number retired and receiving payments will increase, making it increasingly difficult to finance pension schemes.