Backpedaling on pension reform

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Backpedaling on pension reform

We are deeply frustrated at the sluggish pace of the process of reforming the civil servants pension system. After a national organization to build a consensus on the thorny issue failed to meet its deadline, the conundrum was handed over to the National Assembly. But the legislature has already wasted two days fixing the period for its activities. The reform is extremely urgent as the government cannot accomplish it next year when the general election will be held, followed by the presidential election in 2017.

The main outline of the reform has already been presented, and even government employees agree to the basic principle of “Pay more, receive less.” The ruling Saenuri Party and opposition New Politics Alliance for Democracy also reached agreement on a budgetary projection model for the reform. If both sides back down a bit, they could strike a deal before the May 2 deadline. But the responsibility for the mess should be borne by the opposition.

At the last minute, the NPAD came up with a bill without substance - three days before the deadline of the national body that was charged with reaching a grand consensus. The opposition has been dragging its feet by refusing to accept a bill drafted by experts after accommodating most of the opposition’s demands, particularly payment rates.

Opposition leader Moon Jae-in’s statement that a new bill must ensure civil servants’ income after retirement despite budget reductions sounds oxymoronic, as there’s no magic wand for cutting government budgets and guaranteeing their post-retirement income at the same time. Moon’s vow to raise the national pension program’s income replacement rate after the civil servants pension reform doesn’t make sense, either. It was the liberal Roh Moo-hyun administration that pressed ahead with a reform aimed at lowering the national pension income replacement rate from 70 percent to 40 percent. We are dumbfounded by the backpedaling by Moon, a member of the pro-Roh camp.

Moon has come up with a new catchphrase of “A party with economic viability.” If so, civil servants pension reform is his first litmus test. In spite of a strong need to persuade his base that he’s solid on the nation’s economy, he is bent on getting more votes from civil servants in the upcoming April 29 by-elections.

The ruling party also must be held accountable for the logjam. It must get the consensus of the opposition and government employees union by persuading them. The pension reform faces too much opposition at too late a date.

JoongAng Ilbo, Apr. 1, Page 30

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