Abstract: By using the ELES model, this paper calculates 2004-2011 expenditure of China’s rural residents per capita basic life demand and forecasts the appropriate demand level of rural basic pension on this basis and analyses comprehensively financial support feasibility of improving the basic pension for three aspects from the overall level of nation, the central finance and local finance. It suggests to improve properly rural basic pension standard before the end of the “Twelfth Five-Year Plan” and do a reasonable definition of the levels of financial responsibility to payment and establish the linkage mechanism of basic pension linked to rural residents’ income and the lowest living standard of rural residents．