[Reporter’s Notebook] Ruling Party Rejects Pension Reform, Passing 2.6 Trillion Won Monthly Burden to Future Generations

"To carry out major reforms, the ability to reach consensus in the legislature is essential. That is political power, but the Korean National Assembly lacks political power. That is why reforms fail every time."

Earlier this year, a former economic chief from the ruling party said this when asked about the 'three major reforms' at an event. The reason was that no matter how well reforms were prepared, they often fell through due to politics.

The current state of the National Pension reform is exactly like this. On the 28th, the last plenary session of the 21st National Assembly, the passage of the pension reform bill is unlikely. Although the floor leaders of both ruling and opposition parties held a private meeting the day before, they only confirmed their differences. The Democratic Party accepted the ruling party's proposal, but the People Power Party suddenly refused to agree, saying, "Let's prioritize discussion in the 22nd National Assembly." This is a typical 'political failure' where, despite recognizing the urgency of pension reform, insufficient political power prevents agreement.

The ruling party's stated reason for refusal is 'time.' They argue that there is not enough time before the National Assembly ends, so they cannot rush the process. They also explained that structural reform of the pension system is much more important, and that reform momentum weakens if only parametric reforms adjusting numbers are made.

However, the claim of rushing lacks justification and persuasiveness. The starting point of the National Assembly's pension discussion was the Public Deliberation Committee. Since February, 500 citizens gathered to study and debate, producing the opinion of '13% contribution rate and 50% income replacement rate.' Based on citizens' voices, both ruling and opposition parties derived a proposal of a 13% contribution rate and 44% income replacement rate. Criticism that parametric reform is rushed disregards the public deliberation process.

The ruling party's lukewarm attitude will lead to burdens on future generations. According to the Speaker's office, delaying pension reform will accumulate a deficit of 2,156 trillion won over 70 years. Simply calculated, this amounts to about 2.6 trillion won per month. Even at this moment, the fund is rapidly depleting due to low birth rates and aging. Without additional reforms, the fund will be exhausted by 2055, when those born in 1990 start receiving the National Pension.

Even experts who have opposed each other over fiscal stability and income security are now calling for at least parametric reform to pass. They appeal that the 21st National Assembly should not end while increasing the burden on future generations. There is still time. Whether at the plenary session this afternoon or a one-point session tomorrow, there is still time to pass pension reform.