The People Power Party announced on February 24 that it is discussing setting the national pension income replacement rate at around 43-44%. The party stated that it plans to discuss a supplementary budget only after reaching an agreement on the pension reform bill.
Kim Sanghoon, Policy Committee Chair of the People Power Party, held a press briefing that afternoon and said, "If possible, it would be good to hold another working-level meeting during the week." On this day, six officials-including the policy committee chairs from both parties and Minister of Health and Welfare Cho Kyuhong-held their first working-level consultation to reach a pension reform agreement, but failed to come to a consensus.
Currently, both the ruling and opposition parties agree on raising the insurance premium rate (the amount paid in) from the current 9% to 13%. They are gradually finding common ground regarding an increase in the income replacement rate (the amount received). Negotiations are ongoing, with the opposition party not completely ruling out the possibility of accepting the automatic adjustment mechanism proposed by the government and ruling party. Initially, the People Power Party proposed a 42% income replacement rate as its official stance, while the Democratic Party suggested 45%. With Democratic Party leader Lee Jaemyung proposing 44%, one percentage point lower, and the People Power Party also considering the 43-44% range, the gap between the two sides is narrowing.
When asked whether the party could accept a 44% income replacement rate if the opposition agreed to the automatic adjustment mechanism, Kim stated, "The government's position is that if the automatic adjustment mechanism is introduced, it can handle the matter more flexibly," adding, "We will negotiate again regarding the automatic adjustment mechanism and the 44% income replacement rate based on the consolidated proposal," expressing his willingness to continue discussions.
The automatic adjustment mechanism is a system that automatically adjusts the pension premium rate and benefit amount based on factors such as the number of subscribers, inflation rate, and subscribers' life expectancy (pension expenditure). It is designed to flexibly adjust the scale of the national pension for sustainable management. However, labor groups oppose this mechanism, arguing that it would effectively reduce pension benefits. As a result, the Democratic Party maintains that careful discussion is necessary.
The People Power Party also repeatedly urged the opposition party to cooperate on including an exemption to the 52-hour workweek in the Special Act on Semiconductors. Kim requested, "Instead of simply stating an inability to accept the exemption to the 52-hour workweek, please take a more forward-looking approach in order to help the semiconductor industry overcome its current crisis."
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