Some news on the hukou reform

16 Sep
An interesting article appeared on the Strait Times analysing the flaws of the hukou reform: only land (especualtion) for city hukou  and not real transformation, increasing numbers of rural hukou holders prefer to mantain their rural status.

The hukou system started in 1958 to prevent farmers from moving to the cities where workers had special privileges such as subsidised housing, free education and medical care, and old-age pensions.

Since then, there have been attempts to reform it to allow more rural folk to enjoy the benefits of city hukou.

But the reaction of the rural folk in Chongqing shows that the allure of a city hukou is fading. Some farmers readily give up their rural registration, but others are sceptical about the scheme.

Villager Zhao Hong told the Caixin economics magazine he believed the motive behind the move to get farmers urbanised was to move them away from their land so the state could take over.

‘Currently the country needs land to develop the economy. I understand this. The key is how much compensation they will give us,’ he said.

He also questioned if the government would be able keep its part of the bargain, including providing adequate pension, and asked: ‘Who knows if (the pension) will be enough when we are old?’

Another villager, known as Ren, said: ‘Now the countryside has a pension system; health care is supported by a new rural cooperative; and schools don’t require extra placement fees. If you want to go to a good school, urban hukou still require you to pay extra sponsorship fees. I think it is pointless to become a city resident.’

Chongqing farmers like Ren are not alone in thinking there is little advantage in taking up city residency. In some parts of the richer coastal regions, the urbanisation process has slowed.

In Zhejiang province, the number of farmers converting to urban residency dropped by 67 per cent from 570,700 in 2004 to just 189,000 last year. Besides the improved social safety net in the villages, farmers are also reluctant to leave their land because of its soaring value. Reforms have allowed villages to collectively rent out land to enterprises for various types of businesses. Farmers who take part in these schemes are given their share of the profits, which can be substantial where demand is high.

Indeed, according to a People’s Daily report last month, some government officials in Zhejiang province used their political power to change their household registration to a rural one in order to benefit from land rental profits.

In Beijing, students living in its rural counties are offered a city hukou if they manage to secure a place in one of the capital’s universities. Last July, after the university entrance examinations, some students rejected this offer. One told the Chinese media: ‘If I change my hukou, I’d not be able to enjoy the benefits of the village.’ He pointed to the yearly share of profits from land rental as well as pension and financial help for education.

Another obstacle to the urbanisation programme is the flood of migrant workers who choose to go back to the countryside because they are disillusioned with life in the cities and the discrimination they face there.

Since skilled jobs are closed to them, they end up taking low-wage jobs in cities, and are viewed with suspicion by urbanities who see them as uncouth and a source of crime. They suffer high living costs, yet are shut off from subsidies in housing, education and social security which city permanent residents enjoy.

Only a small proportion – the best among them – are offered permanent city residency or residential permits that afford them some benefits.

When migrant workers realise the difficulty of putting down roots in the city, and look at the range of benefits now available to rural residents after social reform, they choose to return to the countryside rather than lose their land, Chinese media reported.

The situation of migrant workers exposes the flaws in hukou reform like that of Chongqing. The city offers to convert the registration of farmers living within its parameters who may be unwilling to do so. Yet, like most cities, it does not offer permanent residency status – except for a very few – to the migrant workers living there who have come from other parts of China and who would like to stay on permanently.

The long-term solution is really to abolish the dual residency system altogether and allow people to choose where they live. Let market forces decide, as some Chinese analysts have suggested. This would also solve the problems of migrant workers who are forced to live on the margins of the urban society.

However, the fear of farmers flooding the cities and overstretching their infrastructure is real, particularly in the prosperous coastal cities. Even second-tier cities such as Shijiazhuang in Hebei province and Zhengzhou in Henan province found their infrastructure, particularly schools, insufficient to cope with the influx of migrants after they allowed migrant workers who had steady jobs and fixed accommodation to convert their rural hukou to a city one.

These less than successful experiments have led some to suggest that China is not ready to dismantle the hukou system fully and that this should take place first in less popular cities like Chongqing and Chengdu in the western regions.

But true urban reform can take place only if cities like Chongqing are bold enough to offer city residency not just to its own farmers but also migrant workers from other parts of China. Then, the country would be truly closer to the ideal of treating farmers and urbanites alike equally.

And and interesting information from Dongguan Today, very small progress, but at least some criteria (even if not very specific):

Dongguan has more than six million migrant workers

Dongguan began testing a ratings system for migrant workers to obtain the city’s hukou (residence permits) from Wednesday.

Those who accumulate 60 points under the system will be able to have their hukou transferred to Dongguan. Around 12,370 people are expected to benefit from the policy this year, said the government on Wednesday.

The rating mechanism is divided into several criteria for evaluation, including residence situation and social insurance status. Education level, property and the time working the Dongguan, social service will also help hukou applicants gain extra points.

The mechanism is intended to make it easier for migrants to apply for hukou. Dongguan has more than six million migrant workers, who do not enjoy the same treatment as their urban counterparts in employment, education, health care and social security.


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