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Outgoing speaker calls for immediate start of pension reform

May 26, 2024 - 15:05 By Jung Min-kyung
National Assembly Speaker Rep. Kim Jin-pyo speaks about pension reform scheme during a press conference held in western Seoul on Sunday. (Yonhap)

The outgoing National Assembly speaker stressed Sunday that the reform of the national pension scheme must kick off before the start of the new parliament later this month, saying now may be the “golden time” to do so.

Rep. Kim Jin-pyo’s remarks come as the tension between the ruling and the main opposition has risen over the details of the pension reform plan, such as the size of the contributions made by National Pension Service subscribers and the benefits they receive.

“It is reasonable to start with the change of details (such as the size of the contributions and the benefits) in the current 21st National Assembly (which closes on May 29) then start the discussions with the systematic overhaul in the (incoming) 22nd National Assembly,” Kim said in a press conference for the national pension scheme.

“This is the golden time for the pension reform, which is the first of such timing in 17 years. If the 21st Assembly fails to complete (its discussions on the details), the timing of the reform could be delayed by more than four years,” he added.

Kim’s remark is in line with Democratic Party of Korea Chair Rep. Lee Jae-myung’s latest push to achieve pension reform by the end of this month.

As a result of the latest 2007 reform, South Korea's public pension requires an employee and the employer to pay a matching contribution equal to 9 percent of the employee's monthly earnings. As of 2024, employees will receive 42 percent of wages in pension benefits each month starting at the age of 65.

Lee's main opposition has pushed ahead with the plan to increase the contribution level to 13 percent of employees' wages, and benefit level to 44 percent, which is 1 percentage point higher than its previous proposal of 43 percent. The ruling party, on the other hand, also proposed to increase the pension contribution level to 13 percent but increase the benefit slightly less, to 43 percent. It later increased the number to 44 percent, but highlighted that the details of the systematic overhaul must be negotiated first.