Government Officials and Private School Pension Retirees Can Pay Severance Pay in Up to 60 Installments When Returning Funds

Ministry of Health and Welfare, Improvement of Public Pension Linkage System

[Asia Economy Reporter Ki Ha-young] In the future, when returning retirement benefits such as civil servant pensions or private school faculty pensions and enrolling in the National Pension, the number of installment payments can be freely set within 60 times.

The Ministry of Health and Welfare announced on the 8th that the "Partial Amendment to the Enforcement Decree of the Act on the Linkage between the National Pension and Occupational Pensions" was approved at the Cabinet meeting. This enforcement decree was prepared to stipulate matters delegated by the partial amendment of the "Act on the Linkage between the National Pension and Occupational Pensions," scheduled to take effect on the 18th, and to improve and supplement deficiencies in the operation of the public pension linkage system.

The public pension linkage system allows those who move without fulfilling the minimum subscription period of the National Pension and occupational pensions (such as civil servant pensions, private school pensions, military pensions) to receive pensions through linkage, whereas previously they only received lump-sum payments separately. If the combined subscription period between pensions is 20 years or more, pensions can be received from age 65.

When applying for linkage, the lump sum received at retirement from the occupational institution must be returned. Previously, the number of possible installment payments for the returned amount varied depending on the length of service: up to 24 times for less than 5 years of service, up to 48 times for 5 to 10 years, and up to 60 times for more than 10 years.

However, with this amendment to the enforcement decree, regardless of the subscriber's length of service, the applicant can decide the number of installment payments for the returned retirement lump sum within 60 times.

The Ministry of Health and Welfare also reorganized the "Linkage Benefit Review Committee" into a "Public Pension Linkage Consultative Body" for practical-level discussions. The Public Pension Linkage Consultative Body is chaired by a general service official belonging to the senior civil service group under the Ministry of Health and Welfare, and includes officials of grade 4 or higher from central administrative agencies such as the Ministry of Strategy and Finance and the Ministry of Education, to discuss and coordinate major matters related to public pension linkage.

An official from the Ministry of Health and Welfare's Pension Policy Bureau said, "With the formation of this Public Pension Linkage Consultative Body, we expect to activate practical discussions on the linkage system, contributing to the operation and development of the system," and added, "Through improvements in payment methods for returned amounts, convenience for linkage applicants will be provided, and the payment burden is expected to decrease."