‘If hukou is abolished now, everyone will swarm into cities’: The system that ties Chinese citizens to one place

Liu Zhe is a graduate of one of China’s top universities, a father of two in his early 40s with a highly paid job in financial services who has lived in Beijing for the past six years. But until recently, he had no right to buy a house or a car in the city and one of his children would have limited access to schools and would be unable to sit her final examination there.

The reason is that Liu’s ”hukou”, or household registration, was in Shanghai where he had lived for the previous 10 years and where he owns an apartment. Three years after he moved to Beijing, he started the process of applying for the Beijing hukou and almost two years later, he got it.

“For me, the key is education, entry to the public primary school, for my daughter as well as for my son, who was born after I moved to Beijing. That is the most important thing for me,” he told The Irish Times.

Introduced throughout China in 1958 to register the population and limit migration from rural to urban areas, the hukou has been reformed a number of times since then. But it remains a mechanism to regulate internal migration and each citizen is registered under the system when they are born, with a rural or an urban hukou linked to their place of birth.

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The hukou determines where Chinese citizens can receive healthcare, where they can buy property and access loans, the level of their social welfare and pension benefits and access to education. Changing hukou status can be difficult and cities like Beijing and Shanghai set high barriers, usually requiring applicants to pay social welfare contributions there for at least five years before they qualify.

“If I don’t have the Beijing hukou, I can still have my kids educated here. But they will be in the second tier of priority in the queue. If there are too many children who want to study in the primary school around where I live, we need to wait in the queue. Otherwise we will be allocated to a school that’s not of good quality,” Liu said.

“Lots of people who are working for foreign companies or have a foreign background, they would like to have their kids educated in the foreign system. But I have a different plan. Because I was educated by the traditional People’s Republic of China system, I don’t think it’s entirely a mistake. I think there are some advantages. So I would like my children educated in the public school system, at least for primary school.”

The problems get bigger as children grow up and competition for places in good middle schools and high schools is more intense. The biggest headache comes with the ”gaokao”, the examination that determines access to third-level education.

Children must sit the gaokao in the place where their hukou is based but there is a wide variation in the education systems across the country. Universities often reserve quotas for applicants with a local hukou, giving Beijingers and Shanghainese an advantage when applying for some of China’s top third-level institutions.

Wei Dong left Beijing after 10 years to return to his home city of Shenyang in northeast China because he could get his daughter into a better school there. He said because it is easier for students from Beijing to get into top universities, the standard of education outside the capital’s very best schools is often poor.

“My daughter started in Beijing. That meant a lower standard of education and that the competition was not so high. At 12, she went back to my hometown and she faced very high competition there, so she was at a disadvantage at first,” he said.

Wei is confident about his daughter’s prospects in her new school and he is happy to be close to his parents as they get older. But his move from Beijing has devalued his pension because although he paid higher contributions in the capital, he will receive a lower payment now that he has returned home.

Beijing’s points system for acquiring the hukou is so onerous that Wei never bothered to apply. But some cities are trying to attract highly qualified people by offering easy access to a hukou for those with the right profile.

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Zhang Xin, a businessman who lives in Beijing with his wife and their young son but had a rural hukou, has recently acquired one for Haikou, the capital of China’s southernmost province of Hainan.

“Haikou established a free trade port a few years ago, and issued some talent-introduction policies, highly educated, professionally skilled personnel. All provincial capitals and cities are scrambling for new talent. This is very easy as only an online application is required,” he said.

“Haikou is a provincial capital, so the quality of teaching and the rate of admission to higher education will still be higher. The change of hukou is actually a small effort for me and I hope it will be better for my child’s future”.

For now, Zhang continues to live in Beijing but he will move to Haikou when it is time for his son to go to school. The move will involve giving up part of his business and he says the hukou system creates obstacles that impact on economic activity.

Most economists agree that the system slows economic growth by limiting labour mobility and Zhengzhou, a city of 12 million in Henan province, last year scrapped most hukou restrictions. Other cities eager to attract more residents have also loosened requirements for acquiring the hukou but Zhang is sceptical about abolishing the system altogether.

“China’s territory is too large, its development is uneven, and its public services are also uneven. If the hukou system is abolished now, everyone will swarm into cities with good medical and educational resources. There are too many people and these cities can’t bear it. It can only be a gradual process of letting go,” he said.

Liu agrees, warning that abolishing the hukou could see the better-off crowding into bigger cities, pushing up house prices and intensifying competition for school places.

“If there’s no control, rich people or more capable people will get the most resources, which will mean that poorer people or local residents, the Beijing guy who was born here, will be kicked out of the city. But where can they go? The whole society will be in chaos,” he said.

Now that he has the Beijing hukou, Liu plans to remain there until his children have finished school but he thinks he might leave the city after that.

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“Maybe they’ll have their own choice to study overseas or in Beijing or another city, I don’t care. And after that I can choose where I would like to live, for example, back in my hometown or in a southern city to enjoy the sunshine and the warm weather,” he said. “Beijing, apart from the medical system here which is very good, is not such an attractive place for me to spend my entire life.”