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UPDATED: November 11, 2010 NO. 45 NOVEMBER 11, 2010
Benefiting All
A new law promotes individual equality in social security benefits and forbids the misuse of funds

KEY TO TREATMENT: A doctor from a village clinic of Tancheng County, Shandong Province, teaches a farmer how to use her rural cooperative medical insurance card in January (ZHANG CHUNLEI)

The Standing Committee of the National People's Congress (NPC), China's top legislature, voted to adopt a social insurance law on October 28 that prevents the improper use of social security funds, after reading it four times and receiving feedback on the draft from the general public.

The Social Insurance Law, the first of its kind in China, specifies a common right for all citizens to access and enjoy five forms of insurance: basic endowment insurance, basic medical insurance, employment injury insurance, unemployment insurance and maternity insurance.

Wu Bangguo, Chairman of the NPC Standing Committee, said that the Social Insurance Law was a fundamental element in China's socialist legal system, and strengthened the supervision of power of local legislatures on the management of social security funds.

The law's adoption would help improve the social security system in both urban and rural areas, ensuring that all citizens enjoy the achievements of the reform policy, Wu said.

The law overcomes many of the obstacles under the old regulations, which restricted movement of the country's increasing migrant population. It states that a new medical payment system should be established to allow medical insurance in one place to be transferred to another. Citizens should also be allowed to pay pension premiums in one place and withdraw money from another.

Zheng Gongcheng, a member of the NPC Standing Committee who studied China's social security system, told newspaper Legal Weekly the adoption of the Social Insurance Law shows that China's social security system has entered a phase of steady development from a two-decade trial stage.

Zheng said the strategic goals of the NPC Standing Committee include expanding the coverage of the social security system to all urban and rural residents, developing it in a fair, universal and sustainable manner, raising people's quality of life and safeguarding individual freedoms, equality and dignity.

As of 2009, a total of 401 million urban workers and non-working urban residents subscribed to basic medical insurance, and the new type of rural cooperative medical care system covered 830 million people. An additional 127 million have unemployment insurance, 149 million have work injury insurance and 108 million have childbirth insurance, according to government statistics.

Xin Chunying, Deputy Director of the Legislative Affairs Commission of the NPC Standing Committee, said the Social Insurance Law reflects the principle of giving equal welfare to rural and urban residents.

For a long time, farmers in China had no social insurance. China launched a rural cooperative medical care program in 2003, under which rural residents and governments jointly contribute to a cooperative fund. Participants can reclaim some of the costs of hospital care. The rate of reimbursement varies according to the ailment and the actual cost of medical expenses incurred. In 2009, a pilot project for a new rural pension insurance system was carried out in China, requiring local governments to pay part or the total amount of the minimum pension insurance premium for rural residents with severe disabilities and other groups with difficulty paying this type of insurance premiums.

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