(Yonhap News Report, February 24, 2025) Ruling Party: "Set the Pension Income Replacement Rate at 42–43% — The Opposition Must Not Force It Through" (Posted September 4, 2026)
(Raising the National Pension's income replacement rate
by 1 percentage point
increases the burden on future generations
by another 1,000 trillion won.)
On the question of National Pension reform, the People Power Party argued on the 24th that the income replacement rate should be settled at a level of 42–43% by agreement between the ruling and opposition parties.
Yoon Hee-sook, head of the Yeouido Institute — the People Power Party's policy institute — said at the emergency committee meeting held at the National Assembly that day, "For a single party to force National Pension reform through on its own is unheard of anywhere at any time," adding, "Because it is so vitally important to the future of the entire country, it is only natural that it should be passed by agreement."
Yoon said, "It was under President Roh Moo-hyun that the decision was made to bring the income replacement rate down to 40% by 2028," and continued, "To turn around now and raise the income replacement rate again is to overturn the agreement reached under President Roh Moo-hyun. There is simply no way we could face our young people." She went on to add, "Last year the People Power Party put forward a proposal that went the other way and raised (the income replacement rate) to 42%. That was because we judged that the only way to raise contributions was through a compromise with the opposition party."
She said, "I want to plead with the Democratic Party, which says it will now force (the National Pension reform plan) through, and with its leader, Lee Jae-myung. Can they look young people straight in the eye and explain why they are pushing a proposal that raises the rate back to 44%?" and urged, "Let us put ourselves in young people's shoes and debate how to reach agreement between the government and ruling party's 42% and the Democratic Party's 44%."
Both the ruling and opposition parties agree that pension reform should raise the contribution rate from the current 9% to 13%, but on adjusting the income replacement rate — premised on the introduction of an automatic adjustment mechanism — the People Power Party is calling for 42–43% and the Democratic Party for 44–45%.
Meeting reporters at the National Assembly, the party's chief spokesperson, Shin Dong-wook, relayed what had been discussed at the "four-party talks" of the ruling party–opposition–government consultative council on state affairs held at the National Assembly on the 20th, explaining, "Our position is that the pension is sustainable only if (the income replacement rate) is brought down to 40%, but since that would leave no room for negotiation at all, we said we would consider going as high as 42%, and a 43% proposal was discussed — yet the Democratic Party held out for 44% to the very end."
Shin said, "Our party's position was to attach an automatic adjustment mechanism to 43%, but Democratic Party leader Lee Jae-myung said he could not accept an automatic adjustment mechanism because the government would go on to cut benefits unilaterally," and reported that "the government side said, 'Even if a situation arises in which cuts are made, they would require the approval of the National Assembly, so there is no need to worry too much.'"
He went on, "The Democratic Party kept (insisting on) 44%, and later put it this way: 'What is so important about that 1 percentage point that you have to be so stubborn about it?'" and added, "The government side said that 'a 1-percentage-point difference is enormous,' and it has been confirmed that the talks then broke down."
