Many commentators contend that the Chinese government adopted an incremental approach to welfare policy reform because its leaders lacked an overall blueprint for it, allowing initiatives to be implemented only after lengthy experimentation. While this perspective has provided an essential account of the implementation and changes of some welfare programmes, it has inadequately addressed the slow progress in rural areas' welfare programmes and the different welfare entitlements for rural and urban residents. Further investigation is therefore required to resolve these anomalies. Using the minimum standard of living scheme (MSLS) as a case example, this article illustrates how the Chinese government's legitimacy needs, during different stages of its economic reforms, have been the principal motivation for the implementation of such schemes. The introduction of an urban MSLS in 1997 aimed to reduce laid-off workers' dissatisfaction following the government's reforms of state-owned enterprises (SOEs). The implementation of a rural MSLS in 2007 was intended principally to minimise conflicts between land-losing farmers and local officials after widespread rural riots. These MSLSs are also minimal and stigmatising public-assistance schemes that fulfil the dual objective of securing a stable political environment for economic reform and maintaining poor people's work ethic for China's mixed economy.