The main opposition party on Wednesday unveiled its own proposal for the reform of civil service pensions, an issue that has gained urgency amid the government’s growing deficit.
The proposal by the New Politics Alliance for Democracy comes three days ahead of the deadline for a joint reform proposal by rival parties and government employees. The government and ruling Saenuri Party have already made their joint proposal.
Kang Gi-jung, NPAD’s chief policymaker, said his party’s proposal centers on keeping pensions at the current level for middle- and lower-class public officials and raising the contribution rate for a sustainable pension scheme.
“The core of our proposal is the strengthening of public pensions and the restructuring of civil service pensions,” he said in a press briefing at the National Assembly.
The NPAD’s proposal calls for a partial application of the national pension plan to civil service pensions. Under the national pension plan, low-income workers receive more in entitlements relative to their contributions compared to the high income bracket. This system would apply to 4.5 percentage points of the 7 percent public servants set aside from their income in contributions toward pension. For the remaining 2.5 percentage points, civil servants would receive entitlements proportionate to their income.
Under the proposal, civil servants would receive about 50 percent of their average salary over their lifetime in monthly pension payments, down from the current 57 percent.
The NPAD estimated that the proposed reform would save a total of 321 trillion won ($291 billion), or 55 trillion won more than the 266 trillion won expected to be saved under the government and ruling party’s proposal.
It also proposed the formation of a body for social compromise on reforming public pensions.
The ruling party called for a clearer proposal.
“As was expected, (the NPAD) is confusing (the public) with vague figures,” Saenuri Chairman Kim Moo-sung said. (Yonhap)
