The core of the personal pension system is likely to be based on an account system with tax incentives.
The personal pension system that has received much attention will soon be unveiled.
The 23rd meeting of the Central Comprehensive Deepening Reform Committee (hereinafter referred to as the "meeting") held on December 17 reviewed and approved five opinions, one of which is the widely anticipated "Opinions on Promoting the Development of Individual Pensions." This also indicates that the third pillar of the old-age security system will enter a new stage of development.
The aforementioned documents have not yet been officially released, but from the previous signals sent by the Ministry of Human Resources and Social Security on various occasions, the core of the personal pension system is likely to be based on an account system with tax incentives.
The personal pension system is here
"Although the Ministry of Human Resources and Social Security has repeatedly stated its position this year, the industry has already expected the introduction and core thinking of the account-based personal pension system, but when this day comes, we are still very excited." A senior financial institution person said A reporter from China Business News said.
In fact, after the Central Economic Work Conference at the end of last year made standardized development of the third-pillar pension insurance reform as an important task of this year’s economic work, the progress bar for the research and promotion of the personal pension system has been significantly accelerated this year. Released a signal about the system in public for the second time.
At the end of February this year, the relevant person in charge of the Ministry of Human Resources and Social Security stated in a press release that after sufficient research and demonstration, drawing on international experience, and summing up some domestic pilot experiences, a preliminary idea has been formed for the third pillar.
The overall consideration is to establish a personal pension system based on the account system, voluntary participation of individuals, and taxation support from the state finances, and the formation of funds to form a market-oriented personal pension system for investment and operation, which is being launched in full swing.
At the end of October, Nie Mingjun, Director of the Pension Insurance Department of the Ministry of Human Resources and Social Security, once again stated that a personal pension system supported by taxation and other policies will be established. Personal pensions are planned to adopt a personal account system, and opinions are being formulated to promote the development of personal pensions, and supporting policies are being studied. .
What is an account-based personal pension system?
This was explained as early as in the 2018 key project of the Chinese Society of Social Insurance, "Research on the Establishment of the Third Pillar Personal Pension System with Chinese Characteristics".
According to the introduction of the research group, the system is an institutional arrangement in which the government encourages individuals to pay to special accounts, and individuals choose corresponding eligible pension financial products to invest in accordance with their own risk and return characteristics to accumulate pension assets, and will follow the individual Leading, participating voluntarily, and enjoying the three major principles of the preferential tax system.
Under this system, the subject of preferential tax policies is the account holder, and the carrier is the account, breaking the barriers of pension products, allowing account holders to use one account to purchase all eligible financial products, and improving the convenience of the third pillar Sex and accessibility.
Nie Mingjun said that in the selection of investment products for the personal pension system, savings deposits, bank wealth management, commercial pension insurance, public funds, etc., are all used as personal pension products, so that participants can choose independently according to different preferences. It also creates a good environment for full and fair competition in the market.
The old-age security system will usher in the spring of development
In addition to the approval of the personal pension system, the aforementioned conference put forward comprehensive requirements for the further development of the pension system.
The meeting emphasized that the development of a multi-level and multi-pillar pension insurance system is an important measure to actively respond to the aging of the population and realize the sustainable development of the pension insurance system.
It is necessary to improve the system design, rationally divide the pension responsibilities of the state, units and individuals, and provide institutional guarantees for the accumulation of pensions for individuals.
It is necessary to strictly supervise and manage, improve supporting policies, and clarify implementation methods, fiscal and tax policies, financial product rules, etc., so that the people can understand, understand, and operate well, so that all parties have rules to follow, and the operation of the system can be monitored and tested.
According to the seventh census data released in May 2021, my country’s population of 60 years and over is 264.02 million, accounting for 18.70% of the national population. Compared with 2010, this proportion has increased by 5.44 percentage points. The aging process is accelerating.
In order to solve the pension payment problem caused by aging, after years of development, my country has initially established basic pension insurance (first pillar), enterprise (occupation) annuity (second pillar), and personal commercial pension insurance (third pillar). ) Pension insurance system.
However, the development of the system has not kept up with the pace of aging.
At present, the three pillars are showing a "lame" situation. The first pillar is dominated by basic pensions but the payment pressure is accumulating year by year. The second pillar has weak corporate annuity growth, while the third pillar can almost be ignored.
In October this year, China Business News and Yangtze River Pension jointly released the "Yangtze River Delta Pension Finance Green Development Report" (hereinafter referred to as the "report") data showed that by the end of 2020, my country's basic pension insurance fund has accumulated a balance of 5.81 trillion yuan, accounting for 46.82%; The total assets of the National Social Security Fund are 2.92 trillion yuan, accounting for 23.56%. When the two are combined, the first pillar accounts for 70.38%.
A total of 69.53 million people participated in enterprise annuities and occupational annuities across the country, accumulated funds of 3.6 trillion yuan, and the second pillar accounted for 29.02% of the total.
Since there is no annual public data on commercial pension insurance, the 55.1 billion yuan of commercial pension annuity insurance in the third quarter of 2020 is simply annualized, plus about 400 million yuan of institutional personal tax-deferred commercial pension insurance, the third pillar It accounts for about 0.6%, which can be almost ignored.
According to the introduction by Huang Hong, vice chairman of the China Banking and Insurance Regulatory Commission, at the State Council’s policy briefing in December 2020, life insurance premium income with pension insurance functions in the United States, the United Kingdom, Canada and other countries accounted for approximately 50% of total premium income. %, pension annuity insurance premium income accounted for more than 35%.
The personal tax-deferred commercial pension insurance launched in 2018 was once considered an important breakthrough in the development of the third pillar.
But three years after its launch, the pilot did not achieve the expected results.
According to data from the central bank, as of the end of 2020, the pilot tax-deferred pension insurance business has achieved a total of 430 million yuan in premium income, with 49,000 insured persons.
Moreover, there has been no new policy for convergence after the trial period expired.
In the 2021 China Financial Stability Report released by the Central Bank in September, the “Regulated Development of the Third Pillar Pension Insurance” was listed as a special topic, and three major pain points of tax-deferred pension insurance were pointed out: First, the incentive effect of tax incentives is limited; Second, the procedures are relatively cumbersome, which weakens the enthusiasm for insurance; third, the homogeneity of products is serious.
Judging from a series of actions this year, the third pillar will be greatly expanded. Compared with the past, more insurance institutions and insurance products issued by them are the main participants. Later, more types of financial institutions and financial products will jointly support the third pillar. The rapid development of the three pillars.
Xiao Yuanqi, vice chairman of the China Banking and Insurance Regulatory Commission, previously stated at the 2021 Financial Street Forum annual meeting that as the society's demand for pension financial products is further released, the third pillar has great market potential.
At present, the number of elderly people aged 60 and over in my country is 264 million, accounting for 18.7%. The demand for pension finance is very huge, and the deposits of residents in my country have exceeded 90 trillion yuan. The financial assets that can be converted into long-term pension funds are very considerable. The foundation and conditions of the three pillars are relatively mature.
After the implementation of the top-level design document of the third pillar of the personal pension system, it will undoubtedly push the development of my country's pension security system and the pension financial industry to a new peak.
Southwest Securities predicts that in the next 5 to 10 years, the rapid increase in the number of elderly people in China will bring about the growth of elderly consumption and the rapid expansion of the elderly care industry. The market size of the elderly care industry is expected to reach 6.4 trillion yuan in 2030.
At the same time, the unbalanced pension structure has also increased the demand for personal pension financial services, and the provision of pension financial services for the elderly to maintain and increase the value of assets will usher in a period of rapid growth.
"Researchers have been calling for more than 20 years. Recently, everyone has been waking up to the issue of elderly care. Now is the best spring." Wang Hong, Dean of China Europe International Business School and Director of Shanghai Social Security Research Center, recently accepted Said in an interview with China Business News.
Author: Yang Qianwen