Zhu Chenge, an associate professor at Northwest University of Politics and Law in Xi'an, Shaanxi, told China Youth Daily that in Shaanxi, many business people have multiple hukou so that they can evade legal and financial liabilities by assuming false identities when signing commercial contracts.

Xinhua News Agency reported in January that one of its reporters found that a fake hukou can be bought for between 30,000 yuan ($4,762) and 50,000 yuan ($7,937) at a local police station in northeast China's Jilin Province.

Experts believe the scandals involving hukou reveals heavy corruption among police.

"The root of the scandals lies in corruption, as involved police officers have deliberately broken the law for personal gain," Sun Zhiming, head of the Economy Institute of the Jilin Provincial Academy of Social Sciences, told Xinhua.

Sun called for thorough investigations to track the industry chain behind the black market and crack down on corruption in police.

The current hukou registration procedures and the management of the national database have made multiple identities difficult to spot. People use the same documents and procedures to obtain a fake hukou as those used to get a legitimate one. Moreover, as long as different identity numbers are assigned to different hukou, a person with multiple identities cannot be immediately identified by the national database even when a similar picture and the same name have already been registered under another hukou.

This loophole is set to be closed as police authorities began implementing fingerprint data at the beginning of the year. New ID card applicants in some large and medium-sized cities are required to submit fingerprints to the household registration database.

Wang Taiyuan, a professor at the Chinese People's Public Security University, told Shanghai Morning Post that ID cards are designed to ensure that each card matches up with one holder, which is not viable using technologies applied in China's second-generation ID cards introduced in 2004. Wang said that the identification portrait on the ID card cannot verify identity, while the inclusion of fingerprints and blood type would virtually eliminate the possibility of one person carrying multiple cards.

Wang said that with the development of global war on terror, many countries are adding more personal information to ID cards.

Reforms

Corruption isn't the only problem present in the hukou system. "Since the hukou system was instituted at the end of the 1950s, it has undergone no fundamental change according to social changes, which has caused pains for certain groups of people," said Bai Zhili, Deputy Dean of the School of Government of Peking University, told China Newsweek magazine.

Bai cited college entrance and family planning policies as hukou-related issues soliciting most public complaints.

In China, a student must sit the national college entrance exam at localities where his or her hukou is registered even if the student has lived with family in another province—and used a different set of textbooks—for many years. Meanwhile, different regions have different admission policies with more fierce competition in densely populated provinces.

A study conducted by the Innovative Institute for Public Management and Policy Studies at Shanghai-based Fudan University concludes that the hukou system borne out of a planned economy has shown major disadvantages as it legitimizes civil discrimination and widens the gap between rural and urban residents, posing an impediment to economic development by restricting the movement of labor and inhibiting urbanization.

Bai said that in most industrial countries, household registration is used by the government as the reference for providing public services while the Chinese Government mainly uses the system for public security management purposes. "Conservative public administration concepts that have been dominant in China for a long time have to change with the development of a market economy," Bai said.

At a conference of provincial police chiefs on January 19, Minister of Public Security Guo Shengkun said that the ministry will cooperate with other government departments to promote reforms of the household registration system.

"Public security authorities, which only administer the paperwork of the household registration system, cannot overcome its limitations alone," said Chen Jiahua, a professor at the School of Social Development and Public Policy of Fudan University. He said that he will closely follow whether the initiative of the Ministry of Public Security has strong support from other related government departments.

Tang Jun, Secretary General of the Social Policy Research Center at the Chinese Academy of Social Sciences, told China Newsweek that a fundamental reform to the household registration system should be about "stripping away interests attached to this system." He said that although pilot reform programs has been carried out by a dozen provinces and municipalities, he has seen no fundamental changes to the system that would alleviate any sense of social unfairness.

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