I don't know why the leadership is not revoking it. I remember listening to a record of an ANU panel discussion on China, and one expert expressed his utmost puzzlement why the Chinese government is not scraping the policy since the demographic forecast is one of the most reliable branch of social sciences and all forecasts are saying China is on its way to a demographic disaster.
Maybe it has something to do with lobbying efforts from the family planning departments in various levels of Chinese government. Those people make their living from murdering Chinese babies and you can expect them doing best they can to keep their jobs.
I for one am not wholly convinced about the validity of such forecast that "if birthrate declines to below x.x" then the population will go into an irreversible tail spin, with no hope of recovery ever ...
Our single-celled cousins on petri dishes beg to differ, and how did "Adam and Eve" populate the larger dish called earth in the first place anyway?
The English took over their peasants' land and herded them to settle overseas and in the process industrialized. The Russians liquidated their peasantry and in the process industrialized.
For other countries it may be through wars of existential proportions to "expend the surplus" while industrializing (Germany/Japan), or the resources blessed by the Almighty (Gulf states), or early and resolute adoption of sound policies in an environment of peace and overall "industriousness" while piggying back on Uncle Sam (small countries include those "Asian Tigers" and some South American states), or exercising the virtue of patience, hard work while keeping heads above neighborhood insanities (Turkey), or by a combination of the above (Europe in general) that they achieve the transition from a rural-based economy to something a little more "modern".
How do the 600 to 800 million Chinese peasants have a chance if the city population is growing and city slickers fight over menial jobs with them? "Eugenics" considerations aside, the city dwellers have to make some "Lebensraum" for the improvished country folk.
To me personally, rightly or wrongly, in the intermediate term, loosening Hukou is more important than forsaking population control measures.