Gov’t mulling pension reform measure with expanded benefits for conscripts, moms

The government is mulling a pension reform plan that includes expanded benefits for conscripts and mothers to reduce the burden on younger generations, sources said Friday.

President Yoon Suk Yeol is expected to announce the pension reform measures centered on striking a balance between different age groups and ensuring the financial stability of the pension system as early as later this month.

Revamping the national pension system is one of Yoon’s key agenda items amid deepening concerns the pension fund could be depleted sooner than expected due to rapid aging.

“The government’s proposed national pension reform plan focuses on reducing the burden on the younger generation,” a senior presidential official told Yonhap News Agency by phone. “It will also include measures to alleviate the pension burden for those who served in the military and women who have given birth.”

The government is considering extending the “birth credit” benefit, which was previously granted starting from the birth of a second child, to the first child and applying it immediately upon childbirth.

Currently, the birth credit is applied when recipients reach 65, the eligible age for pension payments.

The plan also proposes expanding “military service credit” for those who completed mandatory military service.

The current system recognizes only six months of military service as part of the pension subscription period, but the proposal would recognize the entire duration of military service.

In South Korea, all able-bodied men must serve at least 18 months of compulsory military service.

The latest move comes after the ruling and opposition parties failed to reach a compromise on the pension reform scheme during the previous National Assembly.

Both sides agreed on the need for changes that would require people to contribute more and receive more after retirement, but they diverged on the appropriate income replacement ratio.