Reform After 18 Years? High-Income Benefits Today, 6,159 Trillion Won Unfunded Liability in 25 Years [Deep&wide]

The area now demanding priority attention is the management of the unfunded liability. Because the National Pension has set future benefit amounts in advance while collecting relatively low contributions, the unfunded liability — the shortfall in benefits owed — has continued to build up. According to Pension Future Forum estimates, the National Pension's unfunded liability reaches 2,060 trillion won (as of 2025, equivalent to 84.8% of GDP).

To raise the income replacement rate to 43% without increasing the unfunded liability, the contribution rate would have had to be raised immediately to 21.2%. But even eight years from now the rate will still fall short by as much as 8.2 percentage points, so the unfunded liability will surge to 6,159 trillion won (119.2% of GDP) by 2050. This is why this reform is assessed as falling far short of achieving fiscal stability. Because maintaining the system as it stands is difficult, introducing an automatic adjustment mechanism appears unavoidable.

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