Analysis And Strategy Of Personal Account Pension Gap In Future

The fundamental causes of the personal account pension system, is the traditional PAYG system facing financial equilibrium problem. Chinese basic pension insurance system was PAYG system, when this system established. Pension insurance system changed to partial accumulative system under the affect of aging of population, state-owned enterprise reform and the development of economy. State council issued two decisions about basic pension insurance system, in1997and2005. Because the system reform has brought heavy transition cost of and empty account operation problems, people attend less to the future running status of personal account. Focus of this paper is to study whether the personal account solve its balance question.This paper makes a qualitative analysis of the present situation and causes of pension gap, establishes pension personal account gap model on the basis of life cycle theory, general equilibrium theory, actuarial model, demographic change, and economic development. Paper sets the related parameters and estimates the number of retired workers from2012to2035, base on the actual situation. Then paper does the empirical research, predicts the pension personal account gap of retired workers from2012to2035, does equilibrium analysis about relevant factors. Finally, paper gives feasible suggestions for current Chinese pension system.According to the empirical research, at the beginning of implementing new system, personal account pension gap is more than late. Pension personal accounts gradually reach equilibrium, when return rate and contribution years go up. Therefore, this paper proposes to improve return rate and contribution years and other elements of basic pension insurance fund by public policy, to solve existing and future gap by reducing state assets, allocating death tax and issue special bonds.