Bipartisan Policy Council Breaks Down in 30 Minutes... Uncertainty Over Supplementary Budget and Pension Reform (Comprehensive)

Democratic Party Pushes for 44% Income Replacement Rate in Pension Reform Parameters

The bipartisan National Policy Council, presided over by National Assembly Speaker Woo Wonsik, broke down just 30 minutes after it began on the afternoon of March 10. The ruling and opposition parties reached partial agreements, such as forming a working-level consultative body to discuss the supplementary budget bill, but ultimately failed to reach a consensus on pension reform, returning the discussion to square one.

Kwon Seongdong, floor leader of the People Power Party, told reporters immediately after the council at the Speaker's office that "nothing was achieved."

Park Hyungsoo, deputy floor leader of the People Power Party, said, "The floor leaders and policy committee chairs of each party began discussions on key state affairs and made progress on the supplementary budget. We agreed to hold working-level consultations involving the government to proceed with discussions on the supplementary budget bill."

Park further explained the breakdown, saying, "However, regarding pension reform, the Democratic Party had previously said it would gather internal opinions on the basis of accepting a 13% contribution rate and a 43% income replacement rate, but today they stated that they cannot accept the 43% rate."

He added, "Since pension reform has been reset to the starting point, further discussions are not possible. Therefore, our party's floor leader and policy committee chair also concluded that, under these circumstances, we cannot continue discussions on the supplementary budget either."

Kim Sanghoon, policy committee chair of the People Power Party, also commented on the supplementary budget, saying, "If discussions are linked with pension reform talks, I think the supplementary budget could proceed smoothly," but added, "We will need to reconsider that aspect."

Woo Wonsik, Speaker of the National Assembly, is calling Kwon Seongdong, floor leader of the People Power Party (left), and Park Chandae, floor leader of the Democratic Party of Korea, during the National Policy Council held at the Speaker's office on March 10, 2025. Photo by Kim Hyunmin

Democratic Party Insists on 44% Income Replacement Rate for Pension Reform Parameters

In contrast, the Democratic Party indicated that discussions on the supplementary budget could continue. Jin Sungjoon, policy committee chair of the Democratic Party, said after the meeting, "It was repeatedly confirmed that we have agreed to implement the supplementary budget. However, there is still a long way to go to work out the details."

Jin explained that, based on internal party review, the income replacement rate for pension reform parameters should be 44%, not 43%. He said, "As a result of our discussions, the People Power Party's proposal to discuss an automatic adjustment mechanism later and to set the income replacement rate now is essentially a return to the starting point. The Democratic Party's position from the beginning has been that the income replacement rate should be 44% without an automatic adjustment mechanism."

He continued, "For that reason, it is difficult to positively consider the People Power Party's proposal of 43%. Once this position became clear, the People Power Party immediately declared the talks had broken down and left, making further discussions impossible."

Jin argued that while maintaining the 43% income replacement rate, efforts should be made to expedite the supplementary budget. He emphasized, "The government expects that the physical timing for the supplementary budget is early April, but I believe it could be moved up through consultations, and we should do our best to advance it." However, Jin added that no date was set for the next National Policy Council meeting during this session.

Woo Wonsik, Speaker of the National Assembly, is taking a commemorative photo with Kwon Seongdong, floor leader of the People Power Party (left), and Park Chandae, floor leader of the Democratic Party, at the National Assembly Speaker's Office during the State Affairs Council held on the 10th. 2025.3.10 Photo by Kim Hyunmin

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