The Study Of The Notional Defined Contribution For The Town Worker Endowment Insurance

The establishment of the town worker endowment insurance, protect the basic living standards of the majority of workers after retirement, is one of the most basic social insurance system. The reformation and improvement of it has become China’s most crucial and current issue. In the 1990 s, China has established the town worker endowment insurance system, which is the combination of social polling and individual account. Compared to the pay-as-you-go, the combination system was more fairness and efficiency, embodies the helpness between social members. But, as the population aging phenomenon was aggravate, the balance pressure and huge costs appeared, the conversion of the sustainability of the system being questioned. Although the Chinese government made several adjustment, but the problem remains unresolved, the system also has yet to finalize. The rationality of the system caused the attention of the community.By the end of December 2014, Lou Jiwei, the ministry of finance minister in the Chinese Academy of Social Sciences, social security international forum 2014 made it clear that fully fund personal accounts have been unable to continue, NDC is a perfect choice for the next step. Nominal accounts system trigger a theoretical concern.Based on the sort of town worker endowment insurance, this paper analyse the historical factors for the existing problems of the pension system. As well as conduct a comprehensive analysis on the current situation and problems in the current system. We found that there is a large gap in the balance of payments, high restructuring costs and inefficient management of funds and other issues of the current pension model. Make comparison description of foreign countries’ NDC model, analysis the relative advantages and limitations, provides a better implement to China. And then analyse the applicability of NDC model to the town worker endowment insurance. Conducting a theoretical analysis, established the town worker endowment insurance actuarial model of future payments under NDC. Pointed out that the NDC as a new pension system model is conducive to resolving Chinese basic pension Problems, and put forwards the reform proposals. Finally,this paper reach the conclusion that in cooperation with the relevant supporting measures,NDC can be used as a model for the current town worker endowment insurance.NDC, as a transitional system arrangement has several advantages, it is significant to the new idea of China’s endowment insurance reform. In practice, combined with the specific situation in our country, NDC still needs to be perfected, to make sure the system can be healthy and stable.