Governments ordered to top up social security funds 
  (Xinhua)  Updated: 2006-12-03 13:45  
China's Ministry of Labor and Social Security is ordering local governments 
to make up the shortfall in social security funds after striking 
misappropriations were exposed. 
  Social security funds still able to be 
tracked in unauthorized investments should be retrieved immediately, the 
ministry said. 
  Local governments, responsible for the management of 
social security funds, should top up shortfalls themselves if misappropriated 
funds are lost or unable to be traced, said the ministry. 
  The National 
Audit Office published an audit report on November 23, revealing approximately 
7.1 billion yuan (US$900 million) of China's two trillion yuan social security 
funds had been embezzled. 
  The funds were said to be siphoned off for 
"overseas investment, commercial loans to companies, construction of government 
buildings and other purposes". 
  Liu Yongfu, Deputy Minister of Labor and 
Social Security, concluded that the essential cause was an inadequate awareness 
of the significance of social security funds. As a result, state regulations and 
policies were not strictly implemented in some regions. 
  "Labor and 
social security departments, subordinate to their local governments, should take 
the most blame and rectify malpractice in the management of social security 
funds," Liu said. 
  The ministry has ordered all social security funds to 
be kept in separate accounts and urged local labor and social security 
departments to draw up plans to improve fund management by the end of December. 
  The ministry is also preparing to set up an information release system, 
which is expected to publish the operation of social security funds each season 
and every year. 
  It calls for wider media and public supervision over 
collection, expenditure and all the other aspects of fund management. 
  The misappropriation of social security funds was highlighted in 
September by the Shanghai scandal, involving 3.2 billion yuan of city funds, 
which brought down Chen Liangyu, secretary of local committee of Communist Party 
of China (CPC). 
  The social security framework in China includes five 
main insurance programs: pensions, unemployment, medical, injuries at work, and 
pre-natal and post-natal care for women workers.
 
   
 
 
 
   
 
 
 
 
 
  
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