In 1986,Shanghai started to pool retirement wages. In 1993,Shanghai Urban Employee Pension Insurance Rules was promulgated to reform the old system. Under the Rules, social pooling was combined with individual accounts. Employers and employees are obliged to make pension insurance contributions. Eligible retirees can receive their pension benefits.In 1998, according to the Regulations on Establishing a Unified Employee Pension Insurance System by State Council, Shanghai further improves its system. All urban enterprises, government departments and institutions, self-employed are integrated into this unified system, while all labours engaged in whichever remunerative work can make pension insurance contributions. In 2002, the employees contribute 8% of their average monthly wages of previous year. The employers contribute 22% of the total sum of the monthly contribution bases of their employees. Then altogether 11 % is recorded into individual accounts. By the end of 2002, the pension scheme covers 4.5285 million workers. The monthly pension benefits average 880 RMB. Distribution of the benefits to 2.4692 million retirees has been 100% socialised