[Yun Seok-myeong's Pension Reform Story] Korea's Pension and Healthcare Debates as Seen from Taipei and Hsinchu, Taiwan (November 2024)

There was a reason for such vehement criticism. It was born of despair at the state of pension reform discussions in Korea at the time.

Even though the 2003 National Pension financial projection produced results indicating that the contribution rate would need to be raised to as high as 19.85%, the majority of pension experts and opposition parties argued that the introduction of a Basic Pension—as recommended by the OECD—was the most urgent priority, thereby obstructing pension reform.

The following was said by the majority of Korean pension experts and opposition parties—excepting the author and a very small number of others—in urging the acceptance of the OECD's recommendations: "What is urgent is not the fiscal stabilization of the National Pension, but the introduction of a tax-financed Basic Pension."

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Three to four Taiwanese government ministers attended the event, which was held in a large lecture hall of a government examination building. Professor Jen-Der Lue of National Chung Cheng University provided consecutive interpretation of the author's English lecture into Chinese. That professor is the Vice Minister of the Taiwanese Ministry of Health and Welfare, who invited the author to serve as moderator of this forum.

The following question was posed by a Taiwanese Ministry of Welfare official in response to the author's lecture at the time: "Why is the Korean government trying to introduce such a peculiar system? It is difficult to understand." What was so difficult to comprehend was "the provision that reduces the Basic Pension benefit the longer one has been enrolled in the National Pension."

In a context where coverage gaps in the National Pension remain extensive, the provision reducing the Basic Pension benefit by up to 50% as National Pension enrollment periods increase was seen as capable of significantly diminishing the incentive for lower- and middle-income vulnerable groups to enroll in the National Pension.

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In 2013, pressure from the opposition party to fulfill the Basic Pension presidential campaign pledge was intense. Given that the long-term costs involved were beyond imagination, this workaround was devised. It is a method that has commonly been employed to extricate oneself from difficulty through expedient measures while simultaneously maintaining moral justification.

The National Pension restructuring proposal that narrowly failed to pass last May operated on precisely the same principle. It was the very proposal that the Pension Future Forum characterized as "reform in name, deterioration in substance," insofar as it would further increase the burden on future generations, even as it was presented to the public and media as a reform.

Those very experts who had opposed the Basic Pension yet ultimately prevailed in its introduction—even through a change of ministers—went on to lead this deliberative committee. That is precisely how a proposal representing a change for the worse could be recast as a reform!

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The mission and core values of National Taiwan University Hospital are "Uphold social responsibilities" and "Honest and due responsibility."

The author's gaze was repeatedly drawn to the large building marked "Hsinchu Biomedical Science Park," located adjacent to the Hsinchu Branch of National Taiwan University Hospital.

"If we fall behind in global competition even in the medical sector and medical-related industries—which have absorbed so many of our finest human resources—what on earth are we to live on?" This was the feeling the author experienced while observing the traffic that filled the expressway from Hsinchu, which appeared incomparably more vibrant than it had been in the past, back to Taipei!

https://m.asiatoday.co.kr/kn/view.php?key=20241110010004827