Should Housing Provident Fund Be Revoked?

The novel coronavirus outbreak has dealt a heavy blow to a large number of enterprises in China, especially small and medium-sized enterprises (SMEs) and private companies. Against this backdrop, Huang Qifan, former Mayor of Chongqing Municipality and current Chairman of the China International Economic Exchange Center, suggested in a recent article abolition of the housing provident fund system in order to help businesses resume production amid difficulties caused by the epidemic and alleviate their financial burdens.

Under the system, businesses pay a contribution that is at most 12 percent of a worker’s salary every month, while the same amount is deducted from the worker’s salary. The two sums are then deposited into an account under the fund and can be withdrawn only when the worker purchases a house.

Huang’s argument is that