Pension Reform Starting Point: 'National Pension Financial Projection' to Be Released on the 27th

Prediction of Depletion Timing and More
Likely to Be Shortened Further from 2057

On the 9th, after the government work report, Cho Kyu-hong, Minister of Health and Welfare, is giving a briefing.
[Photo by Ministry of Health and Welfare]

[Asia Economy Reporter Lee Gwan-ju] The results of the government's 5th National Pension financial projection, which marks the starting point of discussions on National Pension reform, will be released on the 27th.

According to the Ministry of Health and Welfare on the 24th, the ministry plans to announce the National Pension financial projection results on the 27th. Earlier, in the New Year work report, the Ministry of Health and Welfare stated that it would advance the schedule for the National Pension financial projection from March to January to activate reform discussions.

Minister of Health and Welfare Cho Kyu-hong said in a briefing after the work report regarding pension reform, "According to the National Pension Act, we plan to submit a parameter reform plan focusing on the National Pension's contribution rate and income replacement rate by October this year," adding, "We will do our best to reach social consensus through close consultation with the National Assembly, and include that consensus in the operation plan."

National Pension Reform Government Work Report. [Provided by the Ministry of Health and Welfare]

Parameter reform refers to adjusting figures such as the National Pension contribution rate and income replacement rate while maintaining the basic framework of the pension system. In other words, parameter reform concerns how much is paid and how much is received later. The financial projection to be announced this time will serve as the most fundamental basis for this.

In the 4th financial projection in 2018, the government estimated that the National Pension fund would be depleted by 2057. Since then, as the birth rate decline and aging have intensified over the past five years, the projection is expected to change accordingly. In fact, domestic research institutions have predicted that the depletion point of the National Pension fund will be brought forward by 1 to 3 years compared to that estimate.

The National Pension contribution rate started at 3% in 1988, increased by 3 percentage points every five years, and was set at 9% in 1998, which has been maintained to the present.

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