Fiscal Responsibility And Financial Risk Of Social Security

Social security system plays a “safety net” and “shock absorber” role in the economic and social development. Social security system in China is still in the way of being a sound system, thus, a clear understanding of social security and financial responsibility as well as a revealing of financial risks in the existing social security system will help to build a direction in the system. This paper combines relevant economic theories, and through detailed analysis of the current social security system, will find out the current system defects and financial risks, and ultimately will provide policy recommendations of the social security system development. Analysis of fiscal responsibility in social security system mainly includes the perspectives of public economics, income distribution, macroeconomic regulation and control, personal consumption etc. Among them, income distribution perspective is receiving increasing attention. For theanalysis of social protection, the vast majority of existing literature focuses on the economic attributes of social security. Based on the procedure-decided reality made by the state, enterprises and individuals in social security system, this paper attempts to analyze the political attribute of the social security system, namely, derived influences ofpolitical system and decision-making mechanisms on social security system. Noting the links between rigid welfare problems in Western welfare states and civilian politics,analysis of political attribute should be based on a definite and reasonable level of protection to prevent the outbreak of social security “kidnapping” national fiscal and financial crisis. Currently, there are a variety of social security issues, such as empty accounts in pension insurance, poorly managed social security budget, narrow channels of investment in social security funds, institutional fragmentation etc. Getting rid of thefundamental problems lies in the strengthening of top-level design in the system. This article discusses mainly in the basic design principles and guidelines relating to the insufficient refining of relevant analysis of the top-level design. For top-level design inthe future, academic research will continue to deepen, and specific programs will appear. Only designing from the overall picture and establishing a reasonable system parameters and levels will China’s social security system truly become the “shock absorber” of national economy and “safety net" of people’s lives.