Cases of Excessive Retirement Allowances Paid to Some Private Kindergarten Principals Also Uncovered
The Board of Audit and Inspection has announced the results of its audit of the Teachers' Pension Service, revealing that the agency inflated its estimates of insurance premium income and paid excessive retirement allowances to some private kindergarten principals.
On June 26, the Board of Audit and Inspection disclosed the results of its regular audit of the Teachers' Pension Service and the Government Employees Pension Service, stating that it had notified the agencies to implement measures to prevent recurrence.
According to the Board of Audit and Inspection, over the past three years, the Teachers' Pension Service overestimated insurance premium income by including the standard monthly income of members in their second or third year?who earn more than new members?when calculating the standard monthly income for new members. However, the agency failed to include the "school closure pension"?paid to teachers who retired due to school closures?as an expense, resulting in an underestimation of pension benefit costs. If these errors are corrected and the estimates recalculated, the projected depletion of the Teachers' Pension fund is expected to be brought forward by three years, from 2049 to 2046.
The Board of Audit and Inspection also uncovered cases in which some private kindergarten principals received excessive retirement allowances by raising their own salaries. Retirement allowances for members of the Teachers' Pension are determined by the standard monthly income at the time of retirement. Among the 727 private kindergarten principals who received retirement allowances from the agency between 2021 and 2023, it was found that 155 had a standard monthly income at the time of retirement that was more than 10% higher than the previous year. The audit also identified cases in which individuals received more than 27 million won in additional retirement allowances through such methods. In addition, the Board of Audit and Inspection confirmed that 72 private school administrative staff members, who were subject to mandatory dismissal due to finalized convictions for crimes such as quasi-rape, fraud, or abandonment resulting in death, continued to work for up to 24 years before retiring and subsequently claimed retirement benefits.
The Board of Audit and Inspection has notified the president of the Teachers' Pension Service to establish measures to enhance the reliability of fiscal projections. The Minister of Education was also instructed to revise relevant laws and establish a monitoring system to prevent school staff with authority over salary decisions, such as private kindergarten principals, from inflating their standard monthly income to receive excessive retirement allowances. Furthermore, the Board pointed out that the current Private School Act only requires notification to the appointing authority of the initiation or conclusion of investigations involving teachers, and does not mandate separate notification for misconduct by administrative staff. The Minister of Education was therefore instructed to develop measures to ensure that finalized convictions and similar matters involving administrative staff are also reported to the appointing authority.
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