The Ministry of Civil Affairs has almost finished drafting a policy document on a national social security system that for the first time will cover neglected rural areas, an official said yesterday.

The document will be submitted to the State Council before Spring Festival for approval, an official with the ministry's department of subsistence security, Sun Yang, said.

After the State Council approval, the ministry will join hands with local governments to set up the system, he said.

Earlier, Vice-Minister of Civil Affairs Li Liguo had said that the national rural social security system, expected to benefit about 3.5 percent of the rural population, would be in place by June.

At present, 26 provinces, municipalities and autonomous regions operate their own rural social security systems.

But the new policy will help establish a uniform system across the country, and expand the network to six provinces and autonomous regions Hubei, Yunnan, Guizhou, Ningxia, Xinjiang and Tibet, Sun said.

Also, for the first time the central government would earmark funds for rural social security once the national system is in place.

The central government now provides funds for such a system only in urban areas. "The central government will grant subsidies to areas, depending on their needs and development," Sun said.

Local governments, too, would have to allocate funds to run the system and set their own standards for people eligible for help.

"The eligibility criteria will be determined on the basis of the national poverty line, that is, an annual income of 683 yuan (US$88)," Sun said.

The Guangdong provincial government raised the poverty line in the rural areas last year from a yearly income of 1,000 yuan ($128) to 1,200 yuan ($154).

Yang Tuan, a researcher with the Chinese Academy of Social Sciences' Social Policy Research Center, said a uniform nationwide system would be a big step forward for social policies.

But, she said, an effective supervision mechanism is needed to ensure a fair and transparent system.

For instance, it's difficult to calculate the exact amount of a farmer's annual income and that may result in unfair handing out of money.

One of the solutions, Yang said, is to hold village meetings and let villagers decide who is entitled to the benefits.

(Source: China Daily February 7, 2007)