Does NPAD have an intention to reform the public employee pension?

Both ruling and opposition parties are at loggerheads over the composition of a working group for the reform of the public employee pension program. The main opposition New Politics Alliance for Democracy (NPAD) argues that it needs to create an entity to discuss the reform of the national pension fund along with the proposed reform of the public employee pension. The fact that NPAD tries to associate the national pension fund plan with the proposed reform of the public employee pension plan, which is an urgent matter, reflects that the party is caring about the government employees’ union who opposes the reform.

The reform of the public employee pension plan started based on the public consensus that deficits in the pension should no longer be covered by taxpayers’ money. It is only an excuse to argue that the national pension fund should be reformed in a way that increases the income replacement rate (the ratio of individual pension entitlement to average pre-retirement earnings) like the public employee pension, while opposing the reduction of the income replacement rate of the public employee pension. An increase in the public’s contribution rate (the ratio of contribution to pension to income) is inevitable to Increase the income replacement rate of the national pension fund requires, but it is practically impossible to raise the public’s contributions to the National Pension Service given the challenging economic conditions. It means reversing the national pension fund reform which has been moving in the direction of reducing deficits by paying more and taking less. It is deceiving the people to claim that this is the reform of the national pension fund.

The opposition party says that it will keep the deadline of passing the proposed reform bill on the pension fund for public servants on May 2, but also proposes not to set the deadline for the working group’s activities. The activities of the entity for a great national compromise involving the public servant union ended on Saturday. It was wrong that both the ruling and opposition parties decided to launch a working group to continue negotiations unlike their agreement made on Dec. 23 last year. No set deadline for the working group appears to be an intention to extend the deadline and postpone the operation of the special committee for the reform of public servants at the National Assembly. This raises suspicions that NPAD intends to buy time for April 29 by-elections, for votes from public servants and their families who oppose the reform.

President Park Geun-hye said in a cabinet meeting on Tuesday, “Delaying a day (in reforming the public employee fund) costs eight billion won (7.23 million U.S. dollars) per day for the preservation of the pension. From next year, we will see deficits of 10 billion won (9.04 million dollars) per day and 3.7 trillion won (3.35 billion dollars) a year. But five years later, it will be 20 billion won (18 million dollars) per day and 7.4 trillion (6.69 billion dollars) per year.” Although reform is difficult and painful, we must pull it through because our descendants’ future depends on it. The public should not tolerate the trick aimed at blocking the public employee pension reform.