ijcrb.webs.com FEBRUARY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 10 Analysis of Financing Capacity of the Main Fund-Raising of Sichuan New Rural Old- Age Insurance —Based on the Data of 21 Pilot Counties (Districts) of 2010 Fu Yu Master, College of Economics and Management, Sichuan Agricultural University, Chengdu , Sichuan, China (611130) Wu Ping 1(Corresponding author) Associate professor, College of Economics and Management, Sichuan Agricultural University, Chengdu , Sichuan, China (611130) He Ke Master, World Economics, College of Economics , Sichuan University, Chengdu, Sichuan, China(610065) Abstract New rural old-age insurance is the State Council of the major benefits of agricultural policy, narrowing the gap between urban and rural areas, promoting basic public services, accelerating the construction of the social security system covering urban and rural residents. Since 2009, the new rural endowment insurance experimental work carried out so far, the implementation of various problems encountered in the process, and financing difficulties is one of the first issues to be addressed. Based on the data of 21 pilot counties (districts) of 2010, author chooses Sichuan as the object of study. First, I introduce the new rural pension insurance fund of individuals, groups and government financing of the three main financing capability; Then, measure and analyze the financing capacity of the three main financing; Finally, draw relevant conclusions and recommendations. Keywords: New Rural Old-Age Insurance; the Main Fund-Raising; Financing Capacity 1. Introduction New rural endowment insurance experimental work is the State Council efforts to solve the important problem of farmers' sense of security initiatives. On September 4, 2009, the State Council promulgated "regarding the development of new rural social endowment insurance pilot guidance" (Guo Fa [2009] No. 32), and China's rural social endowment insurance system was into a new phase. The advice select 10% of counties (cities, districts, towns) to carry out the new rural social endowment insurance pilot work in china, and gradually expand the pilot, and realize the basic full coverage of the rural school-age residents before 2020.New rural old-age insurance is another major benefit of agricultural policy of the State Council after abolition of agricultural tax, which will help accelerate the construction of the social security system covering urban and rural residents. And it is a basic project to narrow the gap between urban and rural areas, change urban-rural dual structure, promote the equalization of basic public services. Most importantly, it is a major farmer-friendly policy to achieve the majority of the residents a sense of security, promote family harmony and increase farmers' incomes. 1 Wu Ping is the Corresponding author COPY RIGHT © 2012 Institute of Interdisciplinary Business Research 18 ijcrb.webs.com FEBRUARY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 10 As china's major agricultural province, the new rural old-age insurance pilot work of Sichuan Province is particularly important. According to Document Guo Fa [2009] No. 32 overall deployment and spirit, Sichuan Provincial Government issued a "new type of rural social endowment insurance Sichuan Province, the pilot implementation of measures" (River House [2009] No. 35) to carry out new rural old-age insurance pilot work in 21 pilot counties in October 2009.Sichuan new rural old-age insurance pilot work has been carried out more than a year, and various problems appeared in the process of implementation. The funding difficulties of new rural old-age insurance is the first issues to be addressed. 2. Literature Review 2.1 Foreign Literature Review When Social endowment insurance system was established, it mainly based on modern methods of social pension insurance, but the social pension insurance of most countries abroad was only for government employees and Enterprise workers, not including farmers. To the 1950s, some developed countries established social pension insurance scheme for their farmers step by step, which absorbed all the farmers to the social old-age security system. As the Western developed countries to implement the integration of urban and rural economic development, urban-rural divide and the difference of workers and farmers are small; meanwhile, old- age insurance system is more robust and has a strong fund-raising capacity. Therefore, the research of rural pension insurance abroad mainly starts from the funding mode (the current pay system, fully funded system, and part of the accumulation system) and pay little attention to financing capacity. In addition, there have been more agreeable to international financing mode: Germany and Japan are viewed as the "aid donors" mode; the United Kingdom and Sweden are viewed as the "welfare-type pension insurance" model; Singapore on behalf of the "self-insurance" mode and so on. 2.2 Domestic Literature Review Domestic research on rural old-age insurance dates back to 1992, Ministry of Civil Affairs, "the basic county-level rural social old-age insurance program." New rural endowment insurance research has focused on Guo Fa [2009] No.32 document before and after. Currently, the domestic financing of the new rural endowment insurance study is classified as the following aspects: financing system evaluation, research funding model, the effective level of payment analysis, fund-raising capacity analysis, and use Logit model regression analysis, insurance actuarial models and other methods. However, the main fund-raising capacity of the research funding is mainly from the national and provincial (city) two research points of view. In summary, the current academic research on the new rural endowment insurance follows the principle of three funding categories. Meanwhile, the research pioneered the use of EXCEL and statistical methods to measure the funding of the main fund-raising capacity, and laid the foundation for the follow-up study. However, the scope of the study of individual fund-raising ability is relatively narrow, only the highest grade and lowest grade. Local government funding capacity analysis did not consider this situation: the farmers in different income levels choose different pay grades under the local governments to increase subsidies for causing the situation; At the same time, the new fund- raising capacity of the main fund-raising research and analysis of Sichuan Province currently is still in the blank stage. Therefore, based on the previous studies and 21 pilot counties in 2010 (area) data of Sichuan Province, author chooses Sichuan Province for the study. First, I introduce the three main fund-raising: the new rural pension insurance of individuals, groups, government; Then, measure and analyze the financing capacity of the three main financing of Sichuan Province; Finally, make relevant conclusions and recommendations. COPY RIGHT © 2012 Institute of Interdisciplinary Business Research 19 ijcrb.webs.com FEBRUARY 2012 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 10 3. The Main Financing and Fund-Raising Capacity of the New Rural Pension Insurance of Sichuan Province According to Guo Fa [2009] No. 32 Document: New rural old-age insurance is composed of individual contributions and collective benefits, government subsidies. Among them, the central government subsidies includes subsidies and local government financial subsidies. According to this file and their actual subject, Sichuan Province adjusts the specific provisions of the main fund-raising (River House [2009] No. 35). 3.1 Individual Contributions Rural residents participating in the new rural old-age insurance should be required to pay pension premiums. Currently, the payment standard is set to five grades: 100 yuan / year, 200 yuan / year, 300 yuan / year, 400 yuan / year, 500 yuan / year, and you can pay an additional grade according to the actual situation. Insured person choose the grade pay freely, and the more you pay, the more you get. According to the standard requirements, the provincial government timely adjusts the pay grade. 3.2 Collective Benefits Village organizations with economic conditions should provide subsidies to pay the insured person, and subsidy standards is determined by the democratic village meeting held by the village committee. Meanwhile, It encourages other economic organizations, social welfare organizations and individuals to provide funding for the insured person. 3.3 Government Subsidies 3.3.1 Central Government Subsidies is only Responsible for "Export Subsidies" According to Guo Fa [2009] No.32 Document: the government fullly pays the basis of the new rural old-age insurance pension for the insured person eligible for getting insurance pension. Central and local governments each bear half of the subsidies in the eastern region, and Central Government is fully committed to subsidies in central and western regions. Therefore, western Sichuan Province gets the full central government subsidy, and that is 55 yuan / person / month. 3.3.2 Local Financial Subsidies is not only Responsible for "Export Subsidies" but also "Import Subsidies." export subsidies: First, cities (states) government can improve basic pension standards based on the actual circumstances, while the improving specific standards and the sharing ratio is determined by cities (states) government, by its own burden; Second, cities (states) government may be appropriate