October 26, 2012 / 11:56 AM / in 7 years

Top China official urges residency permit reform

BEIJING (Reuters) - China’s top security official called on Friday for the government to relax the controversial residency permit, or hukou, system to ensure the army of migrant workers can enjoy better services like health care and housing.

Migrant labourers work at a demolished residential site in Shanghai October 18, 2012. REUTER/Aly Song

The 230 million-strong migrant workforce drives China’s economy, but a lack of access to education, health and other services tied to the country’s strict household registration system forces massive saving, restraining Beijing’s efforts to shift the focus of growth to consumption from investment.

It also causes social tensions, something the stability-obsessed ruling Communist Party is desperate to avoid.

In comments to a work meeting cited by the official Xinhua news agency, security tsar Zhou Yongkang said China should establish as soon as possible a new “national residence permit system” to improve services for migrant workers.

The system would cover help with employment, health care, housing, social security and education for migrant workers’ children, said Zhou, a member of the party’s decision making inner circle, the Standing Committee.

“These efforts would help to avoid a new discriminatory dual system in cities and better ensure migrant workers enjoy the fruits of reform and opening up,” the report cited him as saying.

It provided no other details.

China has talked of reforming the hukou system for years, but with little progress. The government has said the system is necessary to manage its vast population.

It essentially classifies its more than 1.3 billion people into two groups, farmers and non-farmers.

The rigid regime means an officially rural resident has no access to education, health and other welfare services in the towns where they live and work, even though they may have been there for years.

China’s migrant workers in their millions flood into cities each year from the impoverished countryside. They are relatively low paid, but have earned annual double-digit pay rises for years, making them a huge potential source of consumer spending.

Reporting by Ben Blanchard; Editing by Nick Macfie

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