[Yoon Administration Economy] Establishment of Public Pension Reform Committee... Reduction in Health Insurance Premium Burden for Regional Subscribers

New Government Economic Policy Direction

[Asia Economy Sejong=Reporter Kwon Haeyoung] The Yoon Seok-yeol administration is establishing a Public Pension Reform Committee to promote reforms of public pensions, including the National Pension, private school pensions, civil servant pensions, and military pensions. Through the financial calculation of the National Pension, which is expected to be depleted by 2054, a plan to improve the financial soundness of the National Pension will also be presented in the second half of next year. To alleviate the burden of health insurance premiums on regional subscribers, property deductions will be expanded, and the health insurance premium assessment system will also be reorganized to focus on income.

The government announced the "New Government Economic Policy Direction" containing these details on the 16th.

The government will conduct the National Pension financial calculation in March 2023 and prepare improvement measures for the National Pension in the second half of the year. Discussions will be held on improving fund management to enhance the long-term profitability of the National Pension by strengthening expertise, responsibility, and independence. According to the "Social Security Policy Analysis Report" released by the National Assembly Budget Office in 2020, the National Pension is projected to run a deficit by 2040 and face depletion by 2054. The government will establish the Public Pension Reform Committee to promote reforms of public pensions, including the National Pension, private school pensions, civil servant pensions, and military pensions.

Yoon In-dae, Director of the Economic Policy Bureau at the Ministry of Economy and Finance, stated, "Financial calculations are necessary to derive appropriate insurance premium rates for the National Pension," adding, "Through this, we will strengthen the soundness of the National Pension and create a committee to promote National Pension reform."

The government also plans to alleviate the excessive burden of health insurance premiums on regional subscribers. Currently, the health insurance premium assessment system is dualized: premiums for workplace subscribers are imposed based only on income according to the premium rate, whereas for regional subscribers, premiums are imposed considering both income and property. The government will expand the property deduction for regional subscribers' health insurance premiums from the current maximum of 13.5 million KRW to a uniform 50 million KRW in the future.

To focus on income-based health insurance premium assessments, the government will also promote the second phase of the health insurance premium assessment system reform in the second half of this year.

Additionally, the government will raise the contribution limits for pension savings and retirement pensions eligible for tax credits. Currently, pension savings can receive tax credits up to 4 million KRW annually, and including retirement pensions, up to 7 million KRW; these will be expanded to 6 million KRW and 9 million KRW respectively. Through this, the government aims to increase subscription rates for personal and retirement pensions and encourage improved returns.

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