"Twenty-seven provinces, municipalities and autonomous regions have already established the system, benefiting 18.15 million people," an official the ministry said.

People, who are covered by the system, received 33.2 yuan (4.25 U.S. dollars) on average each month by the end of 2006 and the figure dropped to 27.6 yuan by the end of the first quarter of 2007.

"As government financial subsidy increases, the allowance will increase gradually," the official with the ministry said, without further specifying.

China has been experimenting the allowance system for years, which were seen as an effort to narrow the gap between rural and urban areas and safeguard social equity.

China's State Council, or the cabinet, last Wednesday held an executive meeting on expanding a rural subsistence allowances system that will satisfy the rural poor's minimum requirements for living.

The meeting, chaired by Premier Wen Jiabao, decided to cover all needy people in rural areas across the country under the allowance program, including the aged, the disabled and those who are unable to work.

Local governments are responsible for the operation of the allowance program, and the central budget will allocate subsidies to areas with financial difficulties, according to the meeting.

China has 23.65 million rural poor, with annual per capita income lower than 683 yuan (87.6 US dollars), by the end of 2005, 5.62 million less than in 2001, according to data from the State Council Leading Group of the Office of Poverty Alleviation and Development.