By Yining Su
Image credit: China Daily
Finally, some potentially substantial news is coming out of the Two Sessions. Reuters reports that a plan to replace the much loathed hukou system and make rural and urban residents “basically equal” will soon be announced.
Quoting an unnamed government researcher, the Reuters story reports that a new “unified national residence permit system” will be announced after the end of the current session of the National People’s Congress.
In a speech to the NPC on March 5, Wen Jiabao, the outgoing premier, said that hukou reform should be accelerated, but did not provide a timeframe for reforms or details on how it would be done, according to the Wall Street Journal.
The hukou system in China is a system of household registration which limits internal migration. People can only receive government services and welfare, like medical coverage, and public education for children, in the place where their hukou is registered.
Most of the millions of migrant workers who have driven China’s economy relentless forward in the past decades do not have hukous for the cities where they live and are thus vulnerable to medical emergencies and faced having to leave their children in their home villages, sometimes in the care of grandparents and sometimes without much supervision.
According to the Wall Street Journal story, an estimated 200 million migrants lack hukou for the city where they live.
One reason hukou reform is finally being taken seriously is that China’s leaders are the midsts of realigning the country’s economy from one based on exports to one based on domestic demand. This requires turning a portion of the migrant worker population into urban, middle-class people. Hukou reform would free up the money migrants would otherwise have saved for medical emergencies and encourage them to buy property in cities and settle there permanently.
The other main reason hukou reform is gaining traction is a result of China’s changing demographics. Due to the one-child policy, the country is ageing rapidly and the population of working-age adults is falling. Already, factories in coastal cities like Dongguan are having trouble finding workers. Hukou reforms could be a way to encourage migrants to return to cities.
One of the main obstacles to hukou reform has been the opposition of local governments in urban areas, who lack the resources to assume the costs of education, welfare, and services for millions more people. It remains to be seen how the reform plan will be address.
It’s hard to emphasize how important hukou reform is. Not only would it right an injustice – the inequality under the law of rural and urban people – it is intimately tied into what is potentially China’s biggest upcoming challenge: urbanization. An estimated 400 million people will move to the cities in the coming 20 years, bringing China’s urban population to over 1 billion. This unprecedented growth has the potential to change China into a wealthy, more equal country, just as it has the potential to create even greater inequalities and social tensions.
Watch this space. And the meantime, listen to Sinica Podcast’s recent show about this issue, featuring Tom Miller, the author of China’s Urban Billion and the guy both Reuters and the Wall Street Journal called on this story.