OECD: "Korea Should Integrate Operation of the National Pension and the Government Employees Pension" (September 20, 2022)

OECD 

Proposed in a Pension System Review Report

‘Raise the contribution rate as quickly as possible, and integrate the operation of the public pensions.’

This is the gist of the National Pension reform plan that the OECD (Organisation for Economic Co-operation and Development) Employment, Labour and Social Affairs Committee proposed on the 20th through its 'Korea Pension System Review Report.'

This report was produced at the request of the Ministry of Health and Welfare to the OECD.

The OECD first recommended that Korea raise the National Pension contribution rate while simultaneously raising the cap on standard monthly income as well.

The current National Pension contribution rate is 9% of income. It has not changed in more than 20 years. Compared to Japan (17.8%), the United Kingdom (25.8%), and the United States (13.0%), however, this is a low level, and many argue it should be raised substantially in light of the low-birthrate trend. A forecast (from the Institute for Social and Public Research) suggests it will need to be raised to as much as 12–13% going forward.

(omitted)

The OECD also advised that operation of the public pensions, including the National Pension and the Government Employees Pension, should be integrated.

The content is that the contribution rates and payout rates of the National Pension and the special occupational pension schemes should be aligned, and both should be changed together into a structure that pays out less (in benefits).

It specified, however, that deficits in the Government Employees Pension and other special occupational pension schemes must not be covered using the National Pension fund's reserves.

Park Jae-man, Director of the Ministry of Health and Welfare's National Pension Policy Division, said, "This means that because the National Pension and the Government Employees Pension differ in their benefit-eligibility age and contribution rate, these need to be brought into closer alignment."

Yoon Seok-myung, former President of the Korean Pension Association, said, "Currently, there are only four countries — Korea, Belgium, France, and Germany — that operate the national pension and the government employees pension separately," and

"it would be desirable to create a mechanism whereby National Pension members and Government Employees Pension members receive the same National Pension benefit, while civil servants receive only an additional amount corresponding to the extra contribution they themselves currently pay," he proposed.

https://n.news.naver.com/article/023/0003717110?sid=102