What is the difference between provident fund and social security?

Social security refers to the five insurance policies, including pension, medical, work injury, maternity and unemployment insurance. CPF refers to Housing Provident Fund. In terms of affiliation, social security and provident fund belong to two different units, the former is the social security bureau, the latter is the housing fund management center.

I. What is the difference between provident fund and social security?

1. From the content point of view, social security mainly includes five kinds of insurance, namely, old age, medical care, work injury, maternity, unemployment insurance, and the provident fund refers to the housing fund, so the social security is not included in the provident fund;

2. In the affiliation of the unit, the social security and provident fund belongs to two different units, the former is the social security bureau, the latter is the housing fund management center;

3. Contributions, social security in the pension insurance and medical insurance need to pay a certain number of years, in order to enjoy lifelong medical insurance treatment; and housing fund is paid monthly, and usually can not be taken out to use.

Social insurance premiums

1. Proportionate premium system

This method is based on the insured person's salary income, set a certain percentage, so as to collect insurance premiums. The main purpose of the original social insurance is to compensate the insured for the loss of income during the risky accident, in order to maintain their minimum livelihood, so it is necessary to refer to their usual income, on the one hand, as a measure of benefits, and on the other hand, as the basis for the calculation of premiums.

The greatest defect of the proportional premium system based on work is that the burden of social insurance is directly linked to wages. Whether the employer and employee both pay social insurance premiums or one of them pays social insurance premiums, the burden of social insurance manifests itself in the form of an increase in the cost of labor, which results in the crowding out of labor by capital, and consequently in an increase in unemployment.

2. Equalization of premiums

This means that the same amount of premiums is charged irrespective of the income of the insured or his employer. This system has the advantage of simple calculation, easy to implement; and the use of this method of collecting insurance premiums in the country, in its payment, generally also use the equalization system, with the meaning of equal income and expenditure. But its defect is that low-income people and high-income people pay the same premiums, in terms of affordability is obviously unfair.

In summary, the provident fund is not statutory, even if the company does not pay the provident fund for employees, there is no problem, but the social security is statutory, the employee and the company if the labor relationship, the company must pay the social security, and the provident fund can only be used to buy a house, can not be taken out.