[Reporter’s Notebook] For Pension Reform to Succeed, Insurance Premiums Must Be Raised

"Everyone knows the direction of pension reform, right? Inevitably, the insurance premium rate will have to be raised." This is the common view shared by government officials and experts I met while covering recent pension reform discussions. While it is necessary to reorganize the linkage with basic pensions and retirement pensions and to find ways to increase the National Pension Service's investment returns, ultimately, raising insurance premiums is the core of the reform. Both experts and government officials are aware of this but do not openly mention it due to public opinion concerns.

Right after the news broke in January that the National Assembly's Pension Special Committee's private advisory group was discussing a 15% increase in National Pension insurance premiums, Minister of Health and Welfare Cho Kyu-hong held an unannounced press conference to strongly deny it, saying "This is not a government proposal." This is in the same context. However, the fact remains that raising insurance premiums is central to pension reform to ensure stable retirement income for the people.

It is difficult to prevent the expected backlash. Even so, to soften opposition, the scope of beneficiaries who can gain additional benefits from pension reform should be expanded in exchange for raising premiums. This is why the Ministry of Health and Welfare is discussing introducing insurance premium support measures for poor self-employed individuals or considering expanding the credit system. [Related article: [Exclusive] 'Supporting National Pension Insurance Premiums for Self-Employed Like Workers'... Government Reviewing System Overhaul] The credit system is a scheme that grants additional recognized periods of National Pension subscription as a reward for socially valuable acts. Currently, there are childbirth credits that add 12 to 18 months of subscription period per child from the second child onward, and military service credits that reflect about six months of subscription period for military service. The Ministry of Health and Welfare believes childbirth credits should apply from the first child, and the military service credit subscription period should be extended beyond six months.

This alone seems insufficient. Especially, the concept of credits itself is unfamiliar. Even those who actually receive credit benefits often do not feel the impact of the benefits they receive. Due to the post-support method of childbirth credits, which are recognized only at the time of pension receipt long after childbirth, officials point out that "the government spends money, but the public's perception is low." To reduce opposition, measures that allow more people to feel the incentives must be introduced. Various insurance premium support methods should be considered. It is also necessary to identify blind spots where pension benefits are lacking but are essential. Even if the 'pocket burden' of the majority of the people increases, it is time to find a way to make them feel the value of it.

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