Under the policy of postponing retirement implemented by the Chinese Communist Party, various regions have introduced the “continuation insurance loan” program, allowing residents who cannot afford to purchase retirement insurance to borrow money from banks to continue payment. The public criticizes the authorities for exploiting and overtaxing the people. This move also reflects the economic difficulties in China, as the number of social security contributions is decreasing.
The Chinese Communist Party’s policy of delaying retirement has come into effect. Recently, online circulation of a promotional flyer from the Tian’e Rural Commercial Bank of Hechi City, Guangxi (referred to as “Tian’e Rural Bank”) for the “continuation insurance loan” has sparked discussion. This loan mainly targets individuals facing difficulties in flexible employment and urban-rural living, with a maximum amount of 80,000 yuan, an annual interest rate of 3%, and a maximum repayment period of 10 years. Repayments start after receiving the retirement pension, with monthly payments not less than 65% to 80% of the received pension to repay the loan principal and interest.
According to information from the Hechi City Government’s official website, Hechi City launched the “continuation insurance loan” policy in September 2023, as a cooperation project between the government and banks, known as the “social security + bank” basic retirement model. As of January 26, 2024, a total of 264 people in the city have successfully applied for the basic retirement insurance “continuation insurance loan,” involving an amount of 2.7639 million yuan.
Following Hechi City, Guiping City in Guangxi introduced the “continuation insurance loan” program in April of this year.
A financial lending industry insider in Shaoxing, Zhejiang expressed disbelief at this, recording a video saying, “I really didn’t expect… some higher-ups are squeezing the lower-level laborers to the fullest. Borrow money to pay for social security, then repay the loan after receiving the retirement pension, plus interest. So, what’s the point of continuing insurance?”
Dubbed the “continuation insurance loan,” it claims to allow the poor to afford insurance when they cannot, by providing loans if they cannot purchase social security. However, media estimates suggest that after the bank deducts the majority of the pension payments, most individuals only receive 100 to 300 yuan per month in retirement funds, which is insufficient to secure personal retirement.
Netizens commented, “Squeezing the last drop of blood from the masses.” “Not content with the wool from the pockets, now resorting to overdrafting it.” “Offering bridal loans to young people, introducing continuation insurance loans to the elderly, exploiting the people to the bone.”
Analysts point out that this reflects the fact that many individuals in flexible employment and urban-rural areas are not continuing insurance, leading to a decrease in social security contributions locally.
An activist from Guangxi, a participant in the Wall Demolition Movement, told Epoch Times that in impoverished regions like Guangxi, where Hechi is located, it has long been referred to as a revolutionary base area, a minority ethnic area, and a border region, known as the “old, young, border, and poor.” Economically, it lags behind in various aspects, compounded by being a mountainous region where the economy was not thriving even in better times. Now, with the economy facing difficulties, regions like this are inevitably suffering.
According to his knowledge, even in Nanning, the provincial capital of Guangxi, many government employees have been asked to borrow money from banks in their personal capacities to be used by the government. Therefore, the introduction of continuation insurance loans is not surprising. With a significant gap in retirement pensions, the Chinese Communist government is unwilling to face a supply disruption. In reality, many have chosen not to pay social security anymore.
It is worth noting that although under public pressure some banks involved have claimed to have suspended their business, journalists in China have revealed that in recent years, several regions, including Anhui, Jiangxi, and Jiangsu, have introduced corresponding “aided insurance loans” policies.
As early as 2017, the city of Baicheng in Jilin, in response to online inquiries, stated that the city had initiated the “aided insurance loan” business, mainly targeting low-income families, individuals having difficulty paying retirement insurance fees, and employees reaching or exceeding the legal retirement age.
The activist believes that the policy of delaying retirement confirms the shamelessness of the Chinese Communist Party, lacking in contractual spirit, intensively draining the common people. “Social security, to put it bluntly, is a fund, albeit with the government’s endorsement. The fund should be self-sufficient, but with the corruption of the Chinese Communist Party, such a massive deficit has emerged. In China’s unregulated environment, social security is simply a tool for fleecing the people.”
The policies such as delaying retirement have sparked strong dissatisfaction and backlash among the public. Some netizens express, “Now many people want to stop paying for retirement insurance, for fear of not living until then, fear of policy changes, or fear of receiving benefits for only a few years.” “If you can’t afford it, why take out a loan… might as well cancel it.”
Mr. Ren, from a natural gas company in Taiyuan, informed Epoch Times that he currently does not pay social security or retirement pension. He pointed out, “The delay in retirement is solely to exploit the ordinary people. The state treasury is draining, unable to collect wealth from the rich and taxpayers, so they are now targeting ordinary people and the poor.”
A netizen from Shanxi named “Falling Leaves” told Epoch Times reporters that they only pay for medical insurance now, not for retirement. Investing money for retirement themselves seems more reliable. The authorities are likely to continue delaying retirement; what if it is extended to age 65? Very likely.
“Delaying retirement is beneficial for government officials but detrimental for ordinary people. Shouldn’t promoting employment involve early retirement? Opening up positions for young people stimulates employment. After the delay, people face more pressure, and who would dare to marry and have children when they need to pay social security for many more years.”
A taxi driver named Duchen, who drives for ten hours a day, expressed, “Delaying retirement is like robbing us grassroots desperately, shamelessly plundering and breaking the contract. Being self-employed, I don’t pay social security. Companies, including private enterprises and government units, have largely stopped contributing.”
Duchen believes that delaying retirement should not exist because privileged individuals are eager to extend their working years, while ordinary people lack the ability to find jobs.
Multiple interviewees remarked on the current high stress of life and suboptimal health conditions faced by people. Dietary problems in China are significant and impact physical health. With each passing year, people’s health is deteriorating, and the notion of delaying retirement is absurd. Can people maintain the specified retirement age with the current quality of life? Many individuals succumb to sudden stress-related deaths, most of them young. For those engaged in heavy industrial work, as they age, can they be expected to delay retirement?
Mr. Su from Shandong informed Epoch Times that he does not pay any social security or medical insurance. With local wages at about three to four thousand yuan, family expenses are high, especially for those starting families. For singles like him, after deducting rent, utilities, and living expenses, how much money remains? In the end, won’t they have to take out loans?
Mr. Su believes that such policies expose the weakness of the Chinese economy, which the authorities have been covering up. There should be fundamental considerations on how to develop the economy and improve people’s livelihoods, rather than duping the public out of their money under the guise of delaying retirement, a diversionary tactic.
“Private entrepreneurs are imprisoned, and ordinary vendors are harassed by urban management. Abusing power for unjust activities, the economy has not seen development or improvement. Delaying retirement, recommending more insurance; it’s a classic case of drawing big cakes, soothing the people, but ultimately just neglecting them. This is the shortfall of what is called democracy,” he concluded.