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An audit report published yesterday found that about 7.1 billion yuan (US$900 million) of the country's 2 trillion yuan (US$253 billion) social security fund had been misappropriated.

 

According to the National Audit Office, the funds were siphoned off for "overseas investment, commercial loans to companies, construction of government buildings and other purposes."

 

Of the total, 2.3 billion yuan (US$291 million) was stolen before 1999 and 4.8 billion yuan (US$607 million) after that, said the report.

 

"The social security funds, except for sums paid to beneficiaries, must be deposited in banks or used to purchase State treasury bonds," said the report.

 

The agency's investigation, which started in September, audited pension, unemployment and health insurance funds in provinces across the country, and discovered corruption and irregular management.

 

At a health insurance fund management center in the Ningxia Hui Autonomous Region, the director and the finance chief transferred 31.9 million yuan (US$4 million) of medical insurance premiums to bank accounts of friends and relatives.

 

China provided pensions to 43.67 million retirees last year and granted living subsidies to 3.62 million laid-off people.

 

(China Daily November 24, 2006)