BEIJING - China on Thursday moved one step closer to reforming its household registration process, with experts lauding the proposed measures for the positive effect they could have on millions of urban residents, even if they were not recipients of permanent resident permits, or "hukou".

The draft document, published by the State Council's legislative affairs office, said migrant citizens could apply for residence permits and enjoy some of the associated rights.

According to the draft document, residence permit holders that had stayed in one place for more than six months and had a stable job there were entitled to free compulsory education, employment support, care for senior citizens and social welfare.

Previously, migrant citizens could only apply for temporary residential permits, with none of the rights or benefits enjoyed by permanent residents.

In recent years, some legal experts have begun to question the legitimacy of the permit, which is required by the police as proof of the right to stay.

The State Council in July laid out its plan to help about 100 million people settle in towns and cities by 2020, with the aim to completely phase out the dual household registration system.

Guan Xinping, a social policy professor from Nankai University, said that when the temporary residence permit was first introduced its aim was to control a floating population.

"The new draft document is focused on how to ensure the rights and benefits of the people," he said, adding that the new residence permit was an interim solution.

"Local government leaders will be reluctant to share their resources with migrant citizens, especially under the pressure of local residents,

"The biggest hurdle to hukou system reform lies in the uneven development between urban and rural areas," Guan said.

In China, big cities like Beijing, Shanghai and Guangzhou boast the lion's share of the nation's best resources, in particular elite-learning institutions and first-class hospitals. Such uneven development has spurred many to move to these places, resulting in the city struggling to provide them with sufficient benefits.

The draft proposed different approaches on how migrant people can obtain "hukou": It said megacities could adopt a "points system" based on employment, accommodation and social security.

However, not everyone is a fan of the proposed reform measures, some experts have raised concern that this approach could create inequality. Lu Jiehua from Peking University, said many big cities favored "high-caliber personnel" over ordinary migrant workers.

The draft is the second major step in hukou reform this year. In November, several provinces scraped urban-rural hukou distinctions and now define both rural and urban dwellers as "residents", leveling the playing field in terms of social security and welfare.

It is hard to tell how many people will benefit if the draft is implemented. Based on figures from 2013, released by the National Bureau of Statistics, there were 170 million migrant workers that wanted to be defined as urban residents.

Legislation differentiating rural and urban residents was first passed in the 1950s. However, since the reform and opening up drive began in the late 1970s, millions of people have migrated to the cities and it has become apparent that they lack sufficient rights due to this out-dated regulation.