Impact On Shanghai Basic Pension Insurance, An Aging Population

With the spread of financial crisis, many European welfare countries are facing sovereign debt crisis, and the pressure of social security is increasing which welfarism brings. Under the background of aging of population in China, the gap of urban basic pension fund is widening. If government subsidy isn’t considered with, the budget deficit of pension fund appeared in13provinces of China in2011.Based on the current situation in China, the impact of aging of population on the urban basic pension insurance exists in two sides. From the microscopic point of view, the aging of population and the increasing of life expectancy will decrease the granting level of personal social pooling account. However, due to lacking of scientific adjustment mechanism, the urban basic pension fund mainly affected by the policy. Thus, from the empirical analysis results, the demographic impacts of aging of population and the extending of life expectancy on the granting level of pension fund are different in theory.From the macroscopic point of view, without government subsidy considered, the aging of population will exacerbate the gap of urban basic pension insurance in Shanghai. Floating population was included in urban resident insurance instead of general insurance in Shanghai in July2011, to some extent, which eased the pressure of pension fund balance. However, because of the accelerated aging and longer life expectancy, the pension fund will face great gap in Shanghai in the future, which brings greater financial pressure as well.