URBAN IDENTITY: Chen Gang, once a villager from Longshi County in southwest China's Chongqing, shows his new residence booklet on August 1, 2010. Chen was the first farmer to obtain urban hukou in the municipality after the city started its household registration reform that day (YANG LEI)

All non-urban workers in Chengdu, southwest China's Sichuan Province, were covered by social security on April 1. The action was regarded as one of the most important measures taken by the Chengdu Municipal Government to reform its household registration, or hukou, system.

"It ensures non-urban workers the right to enjoy the same social insurance as their urban peers," said Zhang Xiaojiang, Vice Director of Chengdu Municipal Bureau of Human Resources and Social Security. "From now on, Chengdu will not differentiate farmers from urban residents and the phrase 'migrant worker' will not exist any more."

An outdated system

Set up in 1958, China's hukou system was meant to control the movement of people between urban and rural areas. Under the system, rural residents who move to cities cannot change their hukou status and therefore have little access to social welfare in cities such as education, medical care, housing or employment, regardless of how long they may have lived or worked in the city.

"Hukou has played an important role as a basic data provider and for identification registration in certain historical periods, but it has become neither scientific nor rational given the irresistible trend of migration," said Duan Chengrong, Director of the Research Center for Population and Development at the Renmin University of China.

Zhang Chewei, Vice Director of the Institute of Population and Labor Economics at the Chinese Academy of Social Sciences (CASS), said, "As migrant laborers have made their contributions to urban development, they should also be given fair treatment when it comes to social benefits."

Besides the unfair treatment, Duan believes that the hukou system is also an obstacle to the market economy. "The trend is toward eliminating it," he added.

Duan said that while the hukou system has failed to stop the influx of rural dwellers into the cities, it has impeded their integration into those areas and their access to the most prized jobs.

"Hukou reforms therefore could allow China to channel labor to where it is most needed, rather than to areas most popular among the labor pool," Duan said. "More equality in the availability of urban education and healthcare should be granted for all workers and their families, while more rural townships need to provide useful public services so that there would not be so many people yearning to move to cities."

China's 12th Five-Year Plan (2011-15), which was approved this year, lays out a plan to set up a mechanism to offer equal public services to people in urban and rural regions.

"During the period, the country should make it a priority to ensure that the transfer of labor and rural land can be made according to law and market rules so that farmers can have better lives in cities and land can be used in a more efficient way," said Dang Guoying, a researcher with the Rural Development Institute of the CASS.

"This requires the government to reform the current hukou system and to establish a unified welfare system to cover urban and rural residents," he said.

Recently, many provinces and cities started to consider reforming their household registration system. In some places, local hukou can be acquired if one buys property or invests a certain amount of money.