GBA opens wider, with social insurance

From January 1, all residents of Hong Kong, Macau and Taiwan who live, work or study in the mainland will be able to participate in the national social insurance scheme. Although applicable across the country, the latest measure is seen as a positive step to draw more residents from the three regions into the Guangdong part of the Greater Bay Area and facilitate the easier movement of people within the region.

The “Interim Measures” cover policies related to retirement, medical treatment, workplace injury, unemployment, and childbirth. The social insurance scheme is funded by contribitions from both workers and employers. Detailed regulations now exist for how non-mainland residents can take part in, and make use of, the various aspects of social insurance.

One key provision is that if Hong Kong, Macau and Taiwan residents leave the mainland before becoming eligible for pension payments, they will not need to give up their social insurance personal accounts. However, they can also choose to close them and be paid out the balance of what has accumulated.

Moreover, enrolment in the mainland’s social security scheme is not compulsory; it is optional. Those who decide to keep their existing schemes in place in Hong Kong, Macau and Taiwan may do so. This will likely come as a relief to employers, as social-security deductions on the mainland are not as cheap as they are in the other jurisdictions. And individuals will not need to pay twice for both places, either.

The move is an indication of flexible policymaking on issues related to cutting red tape and is expected to set an example for how thorny bureaucratic issues can be dealt with in the GBA’s ongoing process of integration.

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