Actuarial Research On The Balance Of Pension Insurance Fund In China

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 or her salary when in employment.For the sake of putting the new pension system on a stable 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 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.However,in the actuarial research on the balance of social endowment insurance fund, most of them are qualitative research and on the basis of country target. So ,the conclusions are not strong for the local problems. Therefore this study will be limited to the scope of the Shanxi Province, analyses the payment situations in the course of social endowment insurance fund payments of Shanxi Province through the construction of social endowment insurance fund balance actuarial model. In the end , this study analyses the impact factors of social endowment insurance fund.