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| China's 'golden decade' brings some relief to rural poor | China's 'golden decade' brings some relief to rural poor |
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| Until a few months ago, 10-year-old Zhao Ai went hungry from dawn to dusk, despite the two-hour trek between his mountain home and school. Now he enjoys a free lunch with classmates. | Until a few months ago, 10-year-old Zhao Ai went hungry from dawn to dusk, despite the two-hour trek between his mountain home and school. Now he enjoys a free lunch with classmates. |
| Like tens of millions of households in China, his family are farmers who live on meagre profits from the crops they can spare and wages sent back by relatives working in cities hundreds of miles away. In a land now dotted with skyscrapers and designer stores, they are scraping by in one of the poorest areas, a remote part of south-western Guizhou province. As others prosper, they fall further behind. Yet in the past decade, a string of measures have offered some relief: the abolition of agricultural tax and tuition fees, the rolling out of medical insurance that reimburses most of their bills, a 55-yuan monthly (£5.50) pension for Zhao's grandfather, and now the school lunches. | Like tens of millions of households in China, his family are farmers who live on meagre profits from the crops they can spare and wages sent back by relatives working in cities hundreds of miles away. In a land now dotted with skyscrapers and designer stores, they are scraping by in one of the poorest areas, a remote part of south-western Guizhou province. As others prosper, they fall further behind. Yet in the past decade, a string of measures have offered some relief: the abolition of agricultural tax and tuition fees, the rolling out of medical insurance that reimburses most of their bills, a 55-yuan monthly (£5.50) pension for Zhao's grandfather, and now the school lunches. |
| "Compared to rich people, our life is not that good – but it is much better than before," said Zhao's grandmother, Xu Zuxian. | "Compared to rich people, our life is not that good – but it is much better than before," said Zhao's grandmother, Xu Zuxian. |
| As China prepares for its leadership transition, state media hail a "golden decade" under the incumbents. Critics call it a lost decade, rife with wasted opportunities for the economic, social and political reforms the country needs. They say Hu Jintao and Wen Jiabao have maintained high growth – not an insignificant achievement, given the wider global economic woes – but failed to tackle the problems now accumulating thanks to that model. | As China prepares for its leadership transition, state media hail a "golden decade" under the incumbents. Critics call it a lost decade, rife with wasted opportunities for the economic, social and political reforms the country needs. They say Hu Jintao and Wen Jiabao have maintained high growth – not an insignificant achievement, given the wider global economic woes – but failed to tackle the problems now accumulating thanks to that model. |
| Yet others believe that for all the disappointments, the administration is leaving behind what could yet prove a significant political legacy: building the skeleton of a welfare state and attempting to put a shelf below those at the bottom of society. | Yet others believe that for all the disappointments, the administration is leaving behind what could yet prove a significant political legacy: building the skeleton of a welfare state and attempting to put a shelf below those at the bottom of society. |
| "The government invested a lot of money in ordinary people's living standards … China is starting to enter the 'welfare China' stage, although it is still at quite a low level," noted Beijing-based scholar Deng Yuwen, in many ways an outspoken critic of the authorities' record. | "The government invested a lot of money in ordinary people's living standards … China is starting to enter the 'welfare China' stage, although it is still at quite a low level," noted Beijing-based scholar Deng Yuwen, in many ways an outspoken critic of the authorities' record. |
| Wang Dewen, social protection economist with the World Bank in Beijing, added: "The government has done a great job." At the beginning, the social insurance programme targeted urban workers, but it gradually extended to migrant workers and introduced rural medical insurance and pension programmes. "They have set up ambitious objectives … They have mobilised resources from the whole society to achieve them." | Wang Dewen, social protection economist with the World Bank in Beijing, added: "The government has done a great job." At the beginning, the social insurance programme targeted urban workers, but it gradually extended to migrant workers and introduced rural medical insurance and pension programmes. "They have set up ambitious objectives … They have mobilised resources from the whole society to achieve them." |
| A decade ago, 147 million urban employees and 55 million rural residents had pension coverage. Now 229 million urban employees are covered, and 449 million rural and urban residents; 124 million are already receiving payments. A few years ago, barely 20% of rural dwellers had medical insurance; now 96% of the population are covered. | A decade ago, 147 million urban employees and 55 million rural residents had pension coverage. Now 229 million urban employees are covered, and 449 million rural and urban residents; 124 million are already receiving payments. A few years ago, barely 20% of rural dwellers had medical insurance; now 96% of the population are covered. |
| While inequality has soared over the past decade – the gap between town and country has expanded, with rural dwellers enjoying less than a third of average urban incomes on official measures and perhaps as little as a fifth according to experts – research by Tony Saich of Harvard University found that satisfaction with the government had actually gone up between 2003 and 2011. | While inequality has soared over the past decade – the gap between town and country has expanded, with rural dwellers enjoying less than a third of average urban incomes on official measures and perhaps as little as a fifth according to experts – research by Tony Saich of Harvard University found that satisfaction with the government had actually gone up between 2003 and 2011. |
| Strikingly, significant increases were seen among the poorest and the wealthiest. "When we started, those in the poorest categories were least satisfied with the local government," Saich said. "That's where I think things like the dibao [a subsidy for the poorest] and some kind of medical insurance have improved their view." | Strikingly, significant increases were seen among the poorest and the wealthiest. "When we started, those in the poorest categories were least satisfied with the local government," Saich said. "That's where I think things like the dibao [a subsidy for the poorest] and some kind of medical insurance have improved their view." |
| How much credit Hu and Wen deserve is a matter of opinion; their predecessors began some programmes and other leaders would presumably have sought to address the problems that emerged with China's development. "But you also have to look at the individuals," said Saich. "Hu has not spent most of his career in the glitziest parts of Shanghai and Beijing; he's been in quite poor areas … [I once heard] Wen say: 'I can't guarantee that I've been to every county in China, but I can guarantee that I've been to every poor county.'" | How much credit Hu and Wen deserve is a matter of opinion; their predecessors began some programmes and other leaders would presumably have sought to address the problems that emerged with China's development. "But you also have to look at the individuals," said Saich. "Hu has not spent most of his career in the glitziest parts of Shanghai and Beijing; he's been in quite poor areas … [I once heard] Wen say: 'I can't guarantee that I've been to every county in China, but I can guarantee that I've been to every poor county.'" |
| The significance of their legacy will depend on how their successors build upon it. "There's been a foundation, but there is a long way to go," said Dorothy Solinger of the University of California Irvine. As an expert on the dibao, she points out: "The whole programme remains miserable and very, very stingy." The urban expansion of the dibao was made under the previous leaders, she notes, and the urban poverty line – which is set in each city – worked out nationally at 15% of urban average disposable income last year, down from the high 20s a decade ago. | The significance of their legacy will depend on how their successors build upon it. "There's been a foundation, but there is a long way to go," said Dorothy Solinger of the University of California Irvine. As an expert on the dibao, she points out: "The whole programme remains miserable and very, very stingy." The urban expansion of the dibao was made under the previous leaders, she notes, and the urban poverty line – which is set in each city – worked out nationally at 15% of urban average disposable income last year, down from the high 20s a decade ago. |
| Even at existing payment levels, there are obvious funding problems. The pensions of current retirees are being paid by new workers, for instance, said David Kelly, research director of Beijing-based consultancy China Policy – and the demographics are working against the system. China is ageing rapidly and its workforce is shrinking. In 2000, there were six workers for every person over 60. By 2030, there will be barely two. | Even at existing payment levels, there are obvious funding problems. The pensions of current retirees are being paid by new workers, for instance, said David Kelly, research director of Beijing-based consultancy China Policy – and the demographics are working against the system. China is ageing rapidly and its workforce is shrinking. In 2000, there were six workers for every person over 60. By 2030, there will be barely two. |
| Authorities must also address broader issues. Corruption and incompetence need to be tackled to ensure funds reach their intended beneficiaries: "There are already cases of fraud and fingers in the till," warned Kelly. | Authorities must also address broader issues. Corruption and incompetence need to be tackled to ensure funds reach their intended beneficiaries: "There are already cases of fraud and fingers in the till," warned Kelly. |
| Many also believe that creating a proper welfare state will require a long-awaited overhaul of the hukou, the household registration system that defines people as urban or rural and allocates their rights to services such as education accordingly. At present migrants – and their children, who inherit their parents' status – in effect become second-class citizens in cities. | Many also believe that creating a proper welfare state will require a long-awaited overhaul of the hukou, the household registration system that defines people as urban or rural and allocates their rights to services such as education accordingly. At present migrants – and their children, who inherit their parents' status – in effect become second-class citizens in cities. |
| "It's the hardest thing to touch because it involves popular sentiment. City dwellers don't want a wave of people coming to share the same benefits as them," warned Kelly. | "It's the hardest thing to touch because it involves popular sentiment. City dwellers don't want a wave of people coming to share the same benefits as them," warned Kelly. |
| Developing a welfare state in China will require the support not just of China's new leaders – but of its citizens, too. | Developing a welfare state in China will require the support not just of China's new leaders – but of its citizens, too. |
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