Actuarial Predictions And Measurements Of China's Retirement Pension Funds Under The SP&IRA

Old-age pension can provide a stable income source for retired workers. It has become a basic thing in our country's arrangement of social security matters. It is important for us to reform and improve this retirement pension in the course of perfecting our country's mechanism of socialist market economy. By adopting a cash-in and cash-out fun-raising method, which pays for the various social security items of the current year through that year's fiscal revenue and through a part of the earnings from the enterprises, the coverage of our country's traditional social security system is limited to workers of state enterprises and to workers of some collectively owned enterprises. This method, owing to its lack of accumulated funds and of figuring out estimates for its due payable responsibility, cannot possess long-term positive financial potentials. Instead, it hinders us from establishing our modern enterprise system and prevents us from reforming our mechanism of using and financing the work force. We are now striving to set up gradually a new social security-providing system, which should enjoy a wide coverage, multi-ways of raising funds and a professional management, in order to cater for the need of reforming the institution of our socialist market economy.The key to the set-up of retirement pension system lies in the balance of using the fund. It concerns not only the guarantee for giving the retired their money, but also concerns our social stability and a safety transition from a young society into an old one. When Social Pooling Plus Individual Retirement Account comes into effect, the issue of keeping the fund's balance will become more complicated than the old cash-in and cash-out pension mechanism. In the old system, a retired worker's pension money is calculated with a fixed ratio according to his of her salary when in employment.For the sake of putting the new pension system on a sound financial basis, we need to measure a long-term stable pension fund-collecting rate and concern for the equilibrium of demand and supply side as such. All this is to be done through actuarial science takes probability theory and mathematical statistics as its standing point, evaluates the outcome of risky events, the future financial balance as well as debt level for various economic programs. In this way, the actuarial science can help us put these programs onto a safety financial basis for future development.This thesis consists of four chapters as follows:Chapter one is entitled "China's choice of her ole-age pension system". In this chapter, the author introduces three basic modes of raising pension funds across the world, namely, the cash-in and cash-out mode, the partially accumulate fund mode (quasi-fund system), and the completely accumulated fund mode (fund system). The author then introduces China's present-day pension system and the way of raising the money needed. The rate of retired workers to non-retired ones, the coverage of this pension system, and the pension fund's annualfinancial issues are also discussed in detail.Chapter two is entitled "The aggregate actuarial model for retirement pension and the analysis of its indexes". Within this chapter, both the model and the indexes are discussed carefully, and a prediction is made for figuring out the future number of workers in employment and of workers in retirement. In addition, the age structures of the two populations are analyzed. This chapter serves as a preparation for the next chapter that mainly concerns about predictions.Chapter three is entitled "Predictions and measurements of China's retirement pension funds under the SP&IRA", In the first place, it measures the fund needed in the framework of social security system, and in the second place, it measures the fund needed in the framework of personal account system. To crown them all, the rate of payable pension money from workers in employment, the rate of substitution, and the rate of retired workers to those non-retired ones, are deduced. The related influential facto...