China has announced plans to reform its pension scheme by unifying the two separate systems for urban and rural residents to allow people better access to social benefits.
The move, part of the efforts to address pension payment gaps between urban and rural areas, was approved by the central cabinet headed by Premier Li Keqiang.
The unified system will build stable expectations for improving livelihood and facilitate population movement, an official statement said, adding that it will also boost consumption and encourage more business start-ups.
Under the new plan pension funds will be pooled from individuals, employers and governments at various levels.
The central government will provide more subsidies to people in less-developed central and western regions.
The pension system will serve as a safety net for millions of seniors, state-run Xinhua news agency reported.
China has the largest aged population in the world, with 194 million people at or above the age of 60 at the end of 2012, according to the China National Committee on Ageing.
The age group is expected to grow to 243 million by 2020, and one-third of the population will be over the age of 60 by 2050.
