Governance, Environment and Socio-Economic Imperatives
Edited by François Gipouloux
Chapter 9: Social security reform and its impact on urbanization: the case of Shanghai
Yuan Zhigang and Tan Jing
The social security system in China was established jointly by central and local governments, based on a core social insurance system, including basic endowment insurance, unemployment insurance, occupational injury insurance, maternity insurance, basic medical insurance and the urban housing fund, called ‘Five Social Insurances and One Housing Fund’ (wu xian yi jin). The allocation of social security and public resources is determined according to a citizen’s hukou registration instead of their place of residence. Thus differences between social security systems in rural and urban areas, and between two different cities, begin to emerge. The flow of this large scale of migration, with migrants leaving their hukou registration place, moves from central and western China to the eastern coastal region, and from rural to urban. According to the Report of China Migrant Development by the National Health and Family Planning Commission, in 2012, the number of migrants reached 236 million, accounting for 17.43 per cent of the total population. Shanghai became a mega-city characterized by migration, resulting in the great contradiction between social security and migration. Some mega-cities offer migrant workers a certain level of social security, but this is meager compared to that for those with that city’s urban hukou identity. Social security for migrants is sometimes lacking, and far below the average level for hukou residents. In this context, the process of citizenization emerges and becomes the current main task of urbanization in China (Liu, 2005).
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