The State Council, China's cabinet, has taken the latest step toward eliminating the cumbersome restrictions people have to endure in China if they move to an area outside their hometown.

A person living in the city of Shanghai holds the new Shanghai Residence Card, a replacement of the long-existing temporary residence permit. [Photo: 21jingji.com]

Under the existing rules in China, if you live outside the area you're registration, or Hukou, is located, you're required to obtain a temporary residency permit.

That temporary residency permit only proves that you're living outside your Hukou.

It doesn't give you any of the social benefits, such as health or education coverage, that you would get under if you lived where your Hukou is registered.

But under the new changes, the State Council is planning to do away with that system, eliminating the term 'temporary,' and potentially giving people who hold the new residency permits more access to social benefits.

Professor Cai Fang with the Chinese Academy of Social Sciences says changing the way the residency permits work will be an important transition for the Hukou reform plans in China.

"For many years, the children of migrant workers had no access to urban education in cities due to the shortcomings of the Hukou system. When these kids grow up and become the new generation in the labor force, their skills won't be able to meet the demands of China's industrial upgrades. As such, receiving fair education is not only a key issue for migrant children, but also for China's sustainable growth in the future."

It is estimated over 270-million people in China are living and working in cities without the proper registration.

It's believed that number continues to rise as more and more people in China's rural areas gravitate toward the cities for work.

Despite the planned changes, Professor Xu Guangjian with Renmin University points out that barriers are still going to be there when the new regulations take effect.

"The biggest problem is where children of residency permit holders will attend the Gaokao, or college entrance exams. This has a lot to do with the unbalanced academic resources across China. Secondly, there will be questions as to whether local authorities will have enough funding to provide for social housing, especially in the big cities. Again, due to limited resources, residency permit holders will probably have to wait a long time, even their local government does eventually offer them housing."

At the same time, the State Council is also making it easier for people to gain access to an urban Hukou through a new points system.

A points system is being developed which will allow people to change their Hukou if they tick-off enough points through their level of education, skill level and social security backgrounds.

No timetable has been given for the new system's enforcement nationwide.

However, major cities like Beijing, Shanghai and Shenzhen have already brought in programs similar to what the State Council is proposing nation-wide.

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