Raise farmers' pensions — don't make the steps too small

Proposals take shape in Beijing

Calls are mounting in Beijing to lift rural pensions faster and in bigger steps. National People’s Congress deputy Lu Qingguo (卢庆国) has proposed a three-stage plan to raise the basic rural pension from the current roughly RMB 200–300 a month to RMB 300 by 2026, RMB 500 by 2030 and RMB 800 by 2035. Others have pushed harder — some lawmakers and commentators want a target of RMB 1,000 per month for rural residents by 2030. Which is more appropriate: cautious increments or a decisive leap? The debate has moved beyond whether to raise pensions to how fast and by how much.

Why faster raises matter

The urgency is clear. Rural elderly now number more than 130 million, and rural areas age faster than cities: the seventh census showed 60+ residents make up 23.81% of the countryside versus 15.82% in urban areas. At present national average urban and rural resident pension payments are about RMB 246 per month (including local subsidies), while enterprise worker pensions average over RMB 3,000 and civil‑servant/PSU retirements about RMB 6,000. That gap is not just numerical. It shapes dignity, consumption and family decisions — including whether younger generations feel able to bear the costs of child‑rearing when elderly support is uncertain.

Funding ideas — and geopolitical sensitivities

How to pay for a substantial uplift is the core political question. It has been reported that one economist suggested redirecting part of export tax rebate receipts — China’s export tax rebate pool is estimated at about RMB 2 trillion — to top up rural pensions. Other ideas include channeling a portion of land‑sale revenues back into pension funds and regularized transfers of state‑owned enterprise dividends. Zhang Xuewu, chairman of Yanjinpuzi (盐津铺子食品股份有限公司), has reportedly urged rules to direct no less than 30% of SOE annual dividends into a rural pension fund, with pilots from 2026 and broader rollout by 2028. Repurposing export rebates or reallocating SOE profits has fiscal logic — but it also intersects with trade policy and international pressures. Altering rebates affects exporters at a time of heightened trade tensions; that makes the politics as important as the arithmetic.

The choice ahead

Policymakers now face a trade‑off between incrementalism and a “milestone” adjustment that closes stark inequalities more quickly. Many proposals call for clear, quantifiable multi‑step targets and an automatic adjustment mechanism linked to CPI and rural incomes to protect purchasing power. In short: lift the floor, and make the uplift durable. The question for China is simple but consequential — will this be another series of small steps, or a concerted stride toward greater rural security and shared prosperity?