China decided on Tuesday to raise state pensions, marking the sixth straight year in which it has boosted payments to retirees as part of a broader drive to promote more domestic consumption. The State Council, or cabinet, will raise pensions next year by an average of 10 percent, exactly in line with this year's increase, according to an announcement on the government's website.
It also vowed to develop a more unified national pension system, making it easier for retirees to collect their benefits wherever they reside. Even after the successive increases, pensions are still very low in China. In Beijing, the most generous of cities, pensions are currently about 1,580 yuan ($231) a month.
The government said the latest increase would lift pensions nation-wide by an average 120 yuan ($17.57) a month. China's threadbare social provisions force citizens to save a large portion of their incomes for schooling, medical needs and retirement, stunting the consumer spending that many see as vital to putting the economy on a more solid footing. China's consumer price index rose 0.6 percent year-on-year in November, turning positive after nine straight months in negative territory.
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