The Korea Herald

피터빈트

Public sector pension row escalates

By Korea Herald

Published : Oct. 24, 2014 - 17:13

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The controversy over the civil servants’ pension system reform plans continued to grow Friday with ruling and opposition parties clashing on the proposal.

In the parliamentary audit of the Government Employees Pension Service, ruling Saenuri Party lawmakers threw their weight behind the government’s reform plans arguing that the system was draining resources.

Since announcing the reforms on Oct. 17, the presidential office has highlighted the need to execute the plans within the year. The plans, which will lower the payout and increase civil servants’ contribution to the system, have received the ruling party’s backing.

“It will be difficult to maintain the system without reform,” Saenuri Party’s Rep. Lee Cheol-woo said. He also said that the system was placing too much burden on the taxpayers, but that civil servants require a separate pension system in light of their long years of service.

“(The system) must be reformed to ensure (stable) retirement while keeping (the payout) at a level that is not considered extravagant in the eyes of the people.”

Ruling party’s Rep. Cho Won-jin also backed the plans highlighting the system’s high payout compared to the national pension provided to ordinary citizens.

According to Cho, the average monthly pension payout will increase to 2.84 million won ($2,670) in 2020 under the current system from the current 2.19 million won.

If the system is reformed according to the government’s plans, the average payout in 2020 will come in at about 2.68 million won.

The main opposition New Politics Alliance for Democracy hit back saying that the figures do not show the full truth.

“The claim that (retired) civil servants receive almost three times as much as (those on) the National Pension is fundamentally flawed,” NPAD’s Rep. Joo Seung-yong said.

According to Joo, a Grade 9 civil servant ― the lowest in the civil service ― who works for 20 years will receive 720,000 won monthly payout after retirement. He added that further lowering the payout was tantamount to abolishing the system.

“Cheong Wa Dae and the ruling party’s drive to reform the system could be an illegitimate political ploy.”

Joo’s claims were backed by Rep. Noh Woong-rae who claimed that the government’s plans were “demanding sacrifice” from the low-level civil servants.

By Choi He-suk (cheesuk@heraldcorp.com)