(ECNS) -- China's Ministry of Human Resources and Social Security on Wednesday reassured pensioners and employees that surplus capital from the country's pension fund used to expand investment channels will not affect pension payouts but would help guarantee the sustainability of future payments, the Beijing News has reported.
The ministry vowed that full pensions would continue to be paid to retirees regularly. Local governments would first reserve adequate pensions and only put idle money towards investment.
Employees who are contributing to the social security fund pool in order to get a pension after retirement should not worry about the security of their money; on the contrary, such investments will help increase returns on the fund to guarantee future payouts to pensioners, the ministry said.
It has confirmed that the maximum proportion of investment in stocks and equities would be capped at 30 percent of total net assets.
China's pension payment is facing increasing pressure from an aging population. Earlier, the Chinese Academy of Social Sciences estimated the country's pension fund has depreciated by nearly 100 billion yuan in the past 20 years, taking inflation into account.
About 90 percent of the country's social security fund has traditionally only been deposited in banks or invested in treasury bonds, while this rigid management and resulting low returns have come under criticism, according to a report by Xinhua News Agency last June.
