Civil servants' pension payments to increase 9%

Starting next year, excluding military personnel, all of the estimated 910,000 civil servants, as of the end of June, will have to pay 9% of their monthly salaries for pension plans, an increase of 1.5%, from the exiting 7.5%. And their pension benefits after retirement will be reduced. Monthly salaries are calculated by dividing three types of allowances such as basic allowances and term-end allowances by 12. The government¡¯s share of the pension plan will increase from 7.5% to 9%. Moreover, the government will compensate for the shortfall of approximately 5% of the total monthly salaries of civil servants, which corresponds to an additional burden of 1 trillion won annually. Consequently, the public tax burden will rise dramatically. The self-administration ministry revealed that as the pension fund for civil servants is expected to be completely depleted by next year due to the government¡¯s increased use of the fund for restructuring processes, it would confirm the amendment bill to the law governing the pension plan for civil servants for legislation on Monday.

On the other hand, a counter-measure committee consisting of three organizations concerned with civil servants denounced the amendment bill, asserting that the government is trying to pass on the burden onto the civil servants. It resolved to submit its own version of the amendment bill to the National Assembly.