The government of Zhuhai, a coastal city in Guangdong province, last week suspended its application process for permanent residency, local media have reported.

The new policy will affect all applicants, including people buying properties in Zhuhai and new graduates who have secured employment with local firms, who applied since last Wednesday, the population registration department of the Zhuhai public security bureau confirmed.

"We have received official notification from the municipal government and there is no timetable for resumption," an official with the department was quoted by the Guangzhou-based Southern Metropolis Daily as saying.

"The fast-expanding population will put huge fiscal pressure on the government, which is one of the key reasons for the decision," the official, who refused to give his name, told the newspaper.

In recent years, the Zhuhai government has introduced a number of measures to improve living and welfare conditions - including 12-year free education for children, medical insurance and free bus travel for the elderly - for residents holding a hukou, or registered permanent residence.

Under its free education scheme, the government will pay subsidies of 680 yuan ($97) to each primary student, 1,020 yuan to junior high school students, 1,600 yuan to senior high school students and 2,100 yuan to vocational high school students per semester.

About 165,000 students with hukou have received subsidies since September.

Prior to the suspension of the residency application process, people buying a new apartment of not less than 75 sq m in Zhuhai were allowed to apply for hukou for themselves, their spouses and children.

"The municipal government studied the policy last year and now the situation is very clear that it will be officially withdrawn sooner or later," the official said.

As well as helping to activate the local real estate market and boost the local economy, the policy also brought about population management problems, he said.

The ban on other groups of people, which were made for the sake of urban statistics, are expected to be lifted soon, he said.

Editor: Yan