Won Hee-ryong Announces Welfare Pledge to Provide 1 Million Won to All Parents for One Year After Childbirth

Reforming the Retirement Income Security System to Increase Benefits

Former Jeju Governor Won Hee-ryong [Image source=Yonhap News]

[Asia Economy Reporter Park Jun-yi] Won Hee-ryong, former governor of Jeju Province and presidential candidate of the People Power Party, has proposed the 'Universal Parental Allowance System,' which provides parents with a monthly payment of 1 million KRW for one year after childbirth. He also announced plans to introduce a 'Retirement Income Security System' by reforming the retirement pension system into a long-term financial product to guarantee income in old age.

On the morning of the 25th, Won held a press conference at the National Assembly and announced the 'National Chance Welfare' pledge, stating, "We must immediately stop the wasteful welfare and populism welfare that ruin South Korea and shift the burden onto the younger generation."

He revealed plans to introduce the Universal Parental Allowance System. Regardless of employment insurance subscription status, parents will receive a monthly parental allowance of 1 million KRW for one year after their child is born. Additionally, those subscribed to employment insurance will be able to receive up to 2 million KRW per month in parental leave benefits.

Won explained the rationale behind the policy, saying, "Currently, parental leave benefits only benefit a small number of people subscribed to employment insurance, leaving a large blind spot. Even for those receiving parental leave benefits, the current maximum amount of 1.2 million KRW is far from sufficient to compensate for income loss. Many worry that having a child is a financial burden."

He added, "The Universal Parental Allowance System is a policy already well-verified in advanced welfare countries like Sweden, which have successfully overcome the low birthrate crisis and established work-family balance. This year, the number of newborns is expected to be 250,000, and if a universal parental allowance of 1 million KRW is given to about 300,000 newborns, the estimated annual budget would be around 3.6 trillion KRW, which the state can afford."

Won also pledged to reform the Retirement Income Security System. He plans to restructure the current lump-sum retirement pension system to allow for long-term payments. He pointed out the problem, saying, "Currently, five working-age people support one elderly person, but by 2060, one working-age person will support one elderly person. Already, 40% of elderly people in Korea live below the poverty line, the highest among OECD countries."

He continued, "By involving the National Pension Service as a new retirement pension operator in the retirement pension market, we will increase returns and lower fees through market competition, ensuring that retirement pensions are paid out in the form of annuities as originally intended. This will create a retirement income security system comparable to the national pension. Once the retirement pension system is normalized, it will help guarantee the retirement income of middle-class elderly people alongside the national pension," he said.

Won concluded, "I will focus secured available resources on income security for low-income elderly people. We will carefully select recipients of the basic pension, currently given to 70% of the population aged 65 and older, to ensure that those elderly who truly need it receive more substantial benefits."

This content was produced with the assistance of AI translation services.