In October 2006, at the 6th Plenary Session of the 16th Central Committee of the Communist Party of China (CPC), a plan was set forth to establish a social security system in China covering both the urban and the rural areas by 2020. Nevertheless, it was generally acknowledged that it would be no easy task to set up a social security system on a par with those in the developed countries in China, a developing country with a large population. Besides, the country's economic base is weak and development between regions and between the urban and the rural areas is unbalanced.
At present and in the near future, the task of developing a new type of social security system will remain an arduous one. The aging population will further add pressure to funds for the payment of pensions and health care, while progressive urbanization demands a sounder social security system to bridge the gap between the urban and the rural populations. Diversified patterns of employment require to extend social security to employees, and those in flexible forms of employment. These demand for the smooth operation of the social security system and a long-term mechanism for its sustainable development.
