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For the first time the country's entire rural residents living in abject poverty can expect the State to cover their subsistence allowances, thanks to the government's latest move to narrow the disparities between cities and rural areas.

The establishment of the wide-ranging subsistence allowance system was announced at the annual central rural work conference, which ended in Beijing on Saturday.

This follows the implementation of such a system in the cities, and a pilot project in some rural areas for nearly a decade, experts said yesterday.

The central rural work meeting said that next year the government will "continue to spend more" on agriculture and social welfare projects and will "explore a social security system covering both urban and rural dwellers."

It did not specify how much more would be earmarked for the purpose, but funds to the rural sector have increased by 15.6 per cent annually between 2003 and this year, according to Ministry of Finance sources.

Du Xiaoshan, deputy director of the Rural Development Institute under the Chinese Academy of Social Sciences, said the government's decision to cover all of the rural poor represents a "big step in social progress."

Had it not been for the economic situation in the past, rural people would have already been covered, just as their urban counterparts are, Du told China Daily yesterday.

"The rural poor are the most vulnerable segment of the population that must be taken care of in the country's drive to build a 'harmonious society,'" he said.

Extending the subsistence allowance network to them would entitle them to the benefits of the country's economic boom, and help ensure social equity, Du said.

In particular, the allowances would help those who have lost their farmlands to development projects, he said.

For centuries, rural residents have relied on their farmlands for a living.

The amount of allowance for each person will not be large, since there are many in need, Du said.

Calculated on an annual per capita income of less than 683 yuan (US$87.6), China had 23.65 million rural residents living in "abject poverty" by the end of last year, according to statistics of the State Council Leading Group of Office of Poverty Alleviation and Development.

The figure, however, would be much higher if calculated according to the United Nations standard of US$1 for each person per day, Du said.

So far, about 2,000 counties have established a minimum living standard for the rural poor, with about 10 million receiving a subsistence allowance, according to official statistics.