Today, the General Office of the State Council released the opinions on promoting the Development of personal Pensions (hereinafter referred to as "opinions"). Our brief comments on this are as follows:

The individual pension system has ushered in an important breakthrough, focusing on six aspects.1) the labourers who participate in the basic old-age insurance for urban workers or the basic old-age insurance for urban and rural residents may participate in the individual pension system; 2) the individual pension or individual account system shall be implemented, and the contributions shall be borne entirely by the participants and fully accumulated; 3) the state shall formulate preferential tax policies; and 4) the upper limit of annual contribution of individual pension for participants is 12000 yuan. 5) the funds of the individual pension fund account can be used to purchase financial products in line with the regulations, which can be chosen independently by the participants; 6) the individual pension can be implemented step by step in combination with the actual situation, and some cities will be selected for trial for one year, and then gradually pushed out.

The establishment of an individual pension system will help to improve China's old-age security system, the capital market is expected to introduce new types of long-term investors, and the construction of the system is expected to improve the cautious expectations of the current market to some extent.。

The individual pension system has ushered in an important breakthrough, focusing on six aspects.

Combined with the contents of the "opinions", we believe that the construction of the individual pension system should focus on the following aspects:

1) scope of participation.Workers who participate in basic old-age insurance for urban workers or basic old-age insurance for urban and rural residents within the territory of China may participate in the individual pension system.

2) the way of participation.The individual pension shall be based on the individual account system, and the contributions shall be borne entirely by the participants and fully accumulated. Participants set up personal pension accounts through the personal pension information management service platform. The individual pension fund account may be designated or opened by the participant in a commercial bank that conforms to the regulations, or may be designated through other financial product sales institutions that meet the regulations.

3) preferential policies and restrictions.The state formulates preferential tax policies to encourage qualified personnel to participate in the individual pension system and receive individual pensions in accordance with the regulations. However, the funds of the individual pension fund account shall not be withdrawn in advance unless otherwise stipulated.

4) level of payment.The upper limit of annual personal pension contributions for participants is 12000 yuan. The Ministry of Human Resources and Social Security and the Ministry of Finance timely adjust the upper limit of contributions according to the level of economic and social development and the development of multi-level and multi-pillar old-age insurance system.

5) ways of investment.Personal pension fund account funds are used to purchase financial products that meet the requirements of bank financial management, savings deposits, commercial old-age insurance, public funds and other financial products that are safe, mature, stable, standardized and focused on long-term preservation of value to meet the preferences of different investors, participants can choose independently. The financial institutions and financial products involved in the operation of individual pensions are determined by the relevant financial regulatory departments and released to the society through the information platform and the financial industry platform.

6) promote implementation.Individual pension will be implemented step by step in combination with reality, that is, some cities will be selected for a trial period of one year, and then gradually pushed out.

The establishment of individual pension system is helpful to improve the old-age security system in China.

At present, China's social security pension system has established a three-pillar framework.First, the basic old-age insurance led by the government and managed by the government constitutes the first pillar of the workers' old-age security system; second, the enterprise or occupational annuity initiated by the government but independently developed by enterprises (formerly supplementary old-age insurance) constitutes the second pillar of the workers' old-age security system; third, the commercial life insurance voluntarily purchased by groups or individuals constitutes the third pillar of the workers' old-age security system.The construction of the individual pension system is mainly based on the supplement and improvement of the third pillar.Judging from the current development, the scale of the three pillars is not balanced, the social insurance fund of the first pillar still accounts for an absolute proportion, the cumulative balance of the social insurance fund in 2020 is 9.4 trillion yuan, and the scale of the second pillar and the third pillar is too small. The establishment of individual pension system is expected to supplement and improve China's old-age security system from the third pillar, which is of positive significance to deal with the current situation of accelerated aging and population dividend in China.

The capital market is expected to introduce new types of long-term investors

According to the data of the Ministry of Human Resources and Social Affairs and the National Bureau of Statistics, by 2020, the number of people participating in urban basic old-age insurance and urban and rural residents' old-age insurance is 450 million and 540 million respectively, indicating that the population base that can participate in the individual pension system is relatively wide. at the same time, based on the current regulations, the upper limit of annual personal pension contributions may be 12000 yuan.This means that from a long-term point of view, the capital scale of individual pension accounts is expected to exceed one trillion yuan.In terms of investment methods, optional types include financial products such as bank financial management, commercial old-age insurance and public offering funds. On the one hand, system construction is conducive to the new business development of relevant banks, insurance, public offering funds and other financial institutions. On the other hand, it is also expected to bring new types of long-term investors to the capital market. From the experience of mature markets such as the United States, the establishment of the old-age insurance system, such as the 401K plan, has brought long-term funds to the American capital market and played a good role in supporting the long-term and steady development of the American stock market.

Institutional construction is also expected to improve the cautious expectations of the current market to a certain extent.

Since the beginning of the year, the capital market has performed poorly under the influence of multiple internal and external factors. On March 16, the Financial Stability and Development Committee of the State Council held a special meeting to study the current economic situation and capital market problems. It is mentioned that "long-term institutional investors are welcome to increase their shareholdings."We believe that the construction of individual pension system will not only help to cultivate and develop long-term institutional investors for the capital market, but also help to improve the cautious expectations of the current market to some extent.. The current market cumulative correction for a long time, the range is not low, the valuation has been relatively low in history, and from the asset prices on the internal and external negative factors have been reflected. We judge that the market is in the "bottom period" after the early rapid correction, and we should not be overly pessimistic about the medium-term outlook of the market, and the medium-and long-term opportunities of the market gradually outweigh the risks.