South Korea's Yoon says $830 bln public pension fund needs urgent reform
Adds quote, details of pension plan, paragraphs 6, 8-9
By Hyunsu Yim and Jihoon Lee
SEOUL, Aug 29 (Reuters) -South Korean President Yoon Suk Yeol said on Thursday the national pension fund, one of the world's largest with $830 billion of assets, needs urgent reformto make it more equitable and to ensure income security for an ageing population.
There had been a loss of confidence in the pension system across generations and there was a need for fundamental and sustainable reform to restore the trust of those who needed it in retirement, Yoon told a televised briefing.
"Now is the time to fundamentally reform the national pension system that has the confidence of neither the elderly nor the youth," he said.
Yoon said the contributions paid in must be increased to ensure the fund is sustainable andthe rate of increase alsodifferentiated between age groups to make it more equitable.
"We will pursue reforms that will be persuasive to the youth who will be paying into the fund the longest and will be receiving pension the last."
"A pension system that leaves the elderly poor and young people suspicious must fundamentally be reformed," he said.
South Korea's public pension fund, established in 1988 and currently the world's third-largest with 1,113.5 trillion won ($833.98 billion) in assets, is expected to be depleted by 2055 as payments start to outpace contributions from 2041.
The contribution rate into the pension scheme, which is mandatory for wage earners and business owners, is 9% of income, compared to 10.6% in the United States, 18.3% in Japan and an average of 15.4% for members of the Organisation for Economic Co-operation and Development (OECD).
The average payout is 31.2% of average pay, compared to the OECD average of 50.7%, meaning South Korea's elderly are among the poorest out of OECD economies.
Reforming the system has been a policy goal for a series of South Korean presidents but there has been little progress because of disagreements on how to approach the issue.
Yoon also said he was pushing ahead with ambitious healthcare reforms, saying the focus is now on improving the quality of medical care in essential disciplines and regions outside of large cities.
More than 10 trillion won will be invested over five years to improve services in those areas, he said.
Yoon's push for healthcare reform has been met by strong objections from doctors, who reject his plan to increase the number of new medical students each year to address a shortage of physicians. Thousands of young doctors walked off the job in February in protest over the reforms, disrupting hospital services.
Reporting by Hyunsu Yim, Ju-min Park, Jihoon Lee, Hyonhee Shin, Writing by Jack Kim
Editing by Ed Davies
Últimas noticias
Descargo de responsabilidades: Cada una de las entidades de XM Group proporciona un servicio de solo ejecución y acceso a nuestra plataforma de trading online, permitiendo a una persona ver o usar el contenido disponible en o a través del sitio web, sin intención de cambiarlo ni ampliarlo. Dicho acceso y uso están sujetos en todo momento a: (i) Términos y Condiciones; (ii) Advertencias de riesgo; y (iii) Descargo completo de responsabilidades. Por lo tanto, dicho contenido se proporciona exclusivamente como información general. En particular, por favor tenga en cuenta que, los contenidos de nuestra plataforma de trading online no son ni solicitud ni una oferta para entrar a realizar transacciones en los mercados financieros. Operar en cualquier mercado financiero implica un nivel de riesgo significativo para su capital.
Todo el material publicado en nuestra plataforma de trading online tiene únicamente fines educativos/informativos y no contiene –y no debe considerarse que contenga– asesoramiento ni recomendaciones financieras, tributarias o de inversión, ni un registro de nuestros precios de trading, ni una oferta ni solicitud de transacción con instrumentos financieros ni promociones financieras no solicitadas.
Cualquier contenido de terceros, así como el contenido preparado por XM, como por ejemplo opiniones, noticias, investigaciones, análisis, precios, otras informaciones o enlaces a sitios de terceros que figuran en este sitio web se proporcionan “tal cual”, como comentarios generales del mercado y no constituyen un asesoramiento en materia de inversión. En la medida en que cualquier contenido se interprete como investigación de inversión, usted debe tener en cuenta y aceptar que dicho contenido no fue concebido ni elaborado de acuerdo con los requisitos legales diseñados para promover la independencia en materia de investigación de inversiones y, por tanto, se considera como una comunicación comercial en virtud de las leyes y regulaciones pertinentes. Por favor, asegúrese de haber leído y comprendido nuestro Aviso sobre investigación de inversión no independiente y advertencia de riesgo en relación con la información anterior, al que se puede acceder aquí.
