Research On The Financial Support Capability Of China’s New-type Rural Social Pension Insurance

China is a large agricultural country, and always has a huge rural population base. As of the end of2011, China’s rural population has accounted for48.73%of the total population. Thus our goals of long-term stability of society and sustainable economic development will not be achieved until the rural issues have been properly addressed. Since the beginning of the21st century, China’s aging problems have become increasingly prominent, and the rapid advance of urbanization and land acquisition made the problems more serious in rural areas. So how to provide a secure old age for the elderly in rural areas has become the focus of attention of the government and relevant departments in recent years. In2009, guidance on new-type rural social endowment insurance pilot was issued by the State Council, which signify that China’s rural old-age career has developed to a new stage. And domestic and foreign scholars’research showed that the government’s financial support plays a very important role in the construction of the new-type rural social endowment insurance system. Therefore, in order to further clarify the financial responsibility of the government in this system, and to promote rationalization of financial support, the paper adopted combination of qualitative analysis with quantitative analysis and comparative analysis with dynamic analysis as well as other on research method in the thesis, in-depth study of the capability of the government’s financial support.The paper was to start from the theories of financial support, introduced how financial support can improve economic efficiency and promotes social equity in the theory of public goods and the theory of welfare economics, and analyzed the need for government intervention in new-type rural social endowment insurance system. In the third chapter, the paper found some deficiencies of financial support, such as insufficient, the uneven distribution between urban and rural areas, the lack of adjustment mechanisms and the form of subsidy is defective, etc, on the basis of the analysis of the structure and the amount of financial burden in our current rural social endowment insurance. Then, by comparison of the role of finance in the system in Germany and Japan, two typical countries, the paper revealed the revelation of the foreign experiences to financial support in China’s new-type rural social endowment insurance system. In response to these problems, the paper presented a recommendation that the central and local government jointly pay the basic pension according to a certain percentage of the previous year’s per capita net income of famers. Then Malthus model, GM model and Matlab software were used to forecast China’s elderly population, the per capita net income and the level of fiscal revenue in the next few years, after that, the paper demonstrated the feasibility of the improved subsidies method. At the end, the paper gave relevant policy recommendations for how to speed up the rationalization of financial support in the new-type rural social endowment insurance system, including allocating fiscal responsibility between the central and local governments reasonably, balancing financial investment in urban and rural areas, building a dynamic adjustment mechanism and standardizing fund operations management etc.