How to Double People's Income?

Question One: Is it possible to double everyone's income?

Bai Tianliang, reporter of People's Daily: The CPC Central Committee has set the encouraging goal of doubling incomes. Will this be the result of inflation deducted and is it possible for everyone to see an increase?

Su Hainan, Vice Director of China Association for Labor Studies: Regarding national economic development up to 2020, the 18th CPC National Congress report pays equal attention to sustainable growth as well as the doubling of GDP and incomes. To do so, we need to first "bake a big enough cake." Increased salaries will entail the deduction of inflation whereby doubled GDP and pace-keeping income is calculated at a constant price.

Based on continuing growth over the coming years, the proportion of income versus per-capita GDP will grow. The report highlights the necessity of improving living conditions and narrowing the income distribution gap. Accordingly, low-income earners will see higher salary growth, mid-income earners an average rise and high-income earners a low curve.

Bai Tianliang: What is the connection between doubled salaries and the "synchronization of income and economic development as well as labor productivity and remuneration" as put forward in the 12th Five Year Plan?

Su Hainan: Synchronization is the means by which to achieve the double income by 2020. Over the coming eight years, as long as China's GDP reaches 7 percent, the goal of doubling incomes is totally attainable.

Question Two: By what means do salaries be doubled?

Bai Tianliang: What needs to be done to realize such a goal?

Su Hainan: First, we need to accelerate transformation of the economic development mode, push forward structural adjustment, expand the tertiary industry, quicken urbanization and take advantage of innovation.

Second, we need to ensure high-quality employment opportunities to secure income growth via job security. In addition, great effort should be made to improve labor skills to achieve higher productivity. Accelerating the pace of urbanization will further enable the rise of salaries.

Third, it's necessary to balance out income distribution. Relevant policies should provide a system guarantee for the doubling of earnings.

It is put forward in the 12th Five Year Plan that minimum incomes be increased by 13 percent year on year, effectively doubling basic wages. We need to set up an effective mechanism to ensure timely payment and growth of income, as negotiated by enterprises and employees for mutual benefit. It's also necessary to find new measures to promote farmer and property income development.

Additional input is necessary concerning social security to help improve livelihoods.

Bai Tianliang: In retrospect, we have noticed that although rural residents have had their salaries greatly increased, figures remain far behind urban levels of ten years ago. What can be done?

Su Hainan: Although the income gap between rural and urban residents is narrowing, it remains substantial.

China's grain production has continually increased over the past nine years against stabilizing agricultural product prices, leaving little room for farmers to up their earnings. Much depends on raising the scale of productivity via scientific progress and subsidies.

Regardless, urbanization remains paramount. To date, the rate has passed 50 percent and if by 2020, it can reach over 60, and then farmer incomes could be raised by 10 percentage points.

Question Three: How can the income gap be narrowed?

Bai Tianliang: Truth is told not everyone will see their earnings double. What can be done to avoid dissatisfaction?

Su Hainan: First, we need to improve rural incomes on the whole.

Second, the poor need security. China's current poverty line is 2,300 yuan, not far off the international standard. In coming years, it can be further raised to meet the World Bank standard of $1.25 a day. Low-income and unemployment standards should be upped.

Third, pensions should be increased. Following eight previous adjustments, figures are currently double the original level. However, more can be done in this sector.

Forth, grassroots income at labor intensive as well as small- and medium-sized enterprises needs improvement. While utilizing collective negotiation, it's also important to improve operation environments via financing and tax cuts to enable businesses to offer higher salaries.

In addition to the above, monopolies should be dissolved so as to evenly distribute resources and increase profitable opportunities. Proper economic leverage should be utilized in curbing the income of those involved in unfair practice.

Furthermore, the earnings of certain high-level managerial personnel need adjustment. In recent years, the state has drawn up a series of regulations on the management of central enterprise leadership salaries. Local and subsidiary enterprises will be the new targets of regulatory action. The income mechanism for high-level managerial personnel at listed companies has also been improved and made more transparent.

Social group wages will also have to be looked at. First, we have to strengthen supervision over banks in terms of management, finances and accounting to clearly reveal the extent of earnings. It's important to crack down on gray and illegal incomes. In addition, personal income tax should be adopted to leverage high wages. In some cases, house property, estate and gift taxes could also be used as a means to adjust incomes.


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