A Research On China's Public-sector Pension System Choice And Sustainability

In early 2015 as the critical moment of deepening reform in china,"Decision of the State Council on the reform of the pension insurance system for the staff in the public sector " has been issued,which combined public pension plan and private sector pension plan,and as China's endowment insurance system taking a key step from the "fragmentation" to "unification".Basing on the background of the reform,we analyses the selection of China' public sector pension pattern through the international comparison and pension economics theories.in addition,we also interpreted the new pension system's sustainable development by simulating quantitative analysis.First of all,this paper elaborated the economics foundation of endowment insurance,which is a theoretical support for endowment insurance mode selection.we also summarized the four main types of public sector pension insurance model in the world,analyzed the differences of the public sector pension system,and particularity,paper sums up the other countries 'reforming experience on the public sector pension system.Through the economic theory and international reform experience,combined with China's public sector pension insurance reform process,respectively interpreting a public sector pay-as-you-go and part of the accumulation fund system in economics model,the result shows that our country public sector pension system choosing partial accumulation pension pattern rather than pay-as-you-go can adapt to the trend of accelerated population aging,in which the age structure of civil servants have a close relationship with the contribution rate of public welfare maximization.After the merger of public-sector pension system in China in 2015,the sustainability of new pension system will become researching focus,The European commission(2001)pointed out "treatment adequacy,financial sustainability and adaptability to changes" are the three principles of long-term sustainable pension plan.The world bank report also proposed "pension system,the basic goal is to be able to provide adequate,affordable,sustainable and stable retirement income".Therefore,under the background of the reform of the system,this paper put forward our country public sector pension plans sustainability analysis framework: pension treatment,financial revenues and expenditures,transition cost.The three aspects are interconnected: annuities treatment directly affects the future pension funds expenditure scale;the size of the transition cost also affect the,at the same time,if the new pension system future financial balance well means system itself can also carry more transition costs and lead to higher pension treatment expectation.In this paper,we analyzed the three questions one by one through the numerical simulation,quantitatively illustrated the sustainability of the new system,put forward Suggestions to further perfecting our country public sector pension plan and to the sustainable development of the endowment insurance system.The logic way of paper is according to "the basic theory of endowment insurance system,and then the main mode of endowment insurance of the public sector,and the particularity,the international reform experience,the domestic reform practice and the pattern choice,the new system sustainability analysis(treatment,forecast of financial revenues and expenditures,transition cost analysis),perfecting system Suggestions.Main innovation and contribution lies in:(1)summarizing the international main public sector pension system model,and comparing their design features relative to the private sector;(2)describing pension system reform process of China's public sector and interpreting the particularity of public sector pension system;(3)explaining selection of our country's public sector endowment insurance model from the perspective of economic welfare maximization;(4)quantitative analysis on public sector pension treatment,transition cost and future financial sustainability after the reform in 2015.The solutions of these practical problems can timely help to reform smoothly and propel the sustainable development of the public sector pension system.