Xinhua: Household Registration System Blamed For Discriminatory Compensation
China's hukou (household registration) system contributed to discrimination in the amount of compensation that rural and urban residents received in a personal injury case in Sichuan province, drawing criticism in a January 27 Xinhua article and a January 24 Procuratorial Daily article (in Chinese).
Three teenage schoolgirls died in a traffic accident in Chongqing municipality on December 15, 2005, when a truck collided with the vehicle they were riding on. The truck company settled with the families of the victims, paying 200,000 yuan (US $24,700) to the families of the two victims who held urban hukou. The company, however, offered only 58,000 yuan (US $7,160) to the family of He Yuan, who held a rural hukou. Despite their rural hukou status, He Yuan's father works as a butcher in urban Chongqing, and He Yuan herself had resided there for 10 years. Both articles note that Chinese law requires less compensation for the deaths of rural residents. The truck company appears to have determined the settlement offer based on its interpretation of the law. After the He family objected to the amount, however, the truck company and driver increased the offer to 90,000 yuan (US $11,000).
Article 29 of the 2003 Supreme People's Court's Judicial Interpretation Regarding Compensation Cases for Personal Injuries says that courts shall set compensation for deaths in personal injury cases at 20 times "the average annual disposable income of urban residents or the average net income of rural residents in the jurisdiction where the case is heard." Similar language in the interpretation distinguishes between urban and rural residents when setting compensation for other injuries. The average annual disposable income for an urban Chongqing resident is 9,221 yuan (US $1,140), while rural Chongqing residents average 2,535 yuan (US $312) per year in net income, according to the Xinhua article.
The Chongqing case has generated negative public commentary. The Xinhua article cites Lu Xueyi, a sociologist at the Chinese Academy of Social Sciences, as stating that the hukou system is the core problem, because it divides China's population into two castes. The same article quotes He Yuan's father as saying "My daughter had lived in the city for 10 years. She didn't pay less for her school fees because she had [a] rural hukou. Why was her life worth less than half of that of her classmates?"
The soundness of the legal basis that apparently underlies the truck company's settlement offer is not clear. The SPC interpretation requires different compensation for urban and rural residents (jumin), but does not define these terms based on an individual's hukou status. The head of the civil law tribunal of the Chongqing High People's Court said that the court is considering issuing an opinion that would set compensation awards for rural migrants who have lived in the city for over a year and have a "stable source of income" and a "stable place of residence" at the same level as long-term urban residents, according to the Procuratorial Daily article.
The discrimination in the compensation offered to the Chongqing families reflects current practice in that a range of legal rights and public benefits are linked to individuals' hukou identification rather than their actual place of residence. This practice has helped create a hereditary legal barrier that discriminates against migrants who hold rural hukous. For more information, see the Commission's recent topic paper on the subject, the chart of various national and provincial hukou reforms through the end of 2004 on the Freedom of Residence page of the Commission's Web site, the Commission's 2004 and 2005 Annual Reports, and the Commission's roundtable on hukou reform.