Time is not on the PPP’s side

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Time is not on the PPP’s side

Published: 30 May. 2024, 19:16 Updated: 31 May. 2024, 09:47

Lee Sang-ryeol
The author is a senior editorial writer of the JoongAng Ilbo.

The 21st National Assembly shuttered without addressing the long-standing call to reform the deficit-bound national pension. The main opposition party’s leader offered to accept the terms of the governing party to pass the reform bill before it expired with the Assembly’s term. It had been the presidential office and the governing People Power Party (PPP) that backtracked at the last minute and wanted the task to be handled by the incoming legislature. The deferment raised eyebrows since pension reform is one of President Yoon Suk Yeol’s key campaign promises.

Democratic Party (DP) leader Lee Jae-myung is fully enjoying the halo as a shadow president. As commander of a majority party, Lee has been taking initiatives on pension reform and other issues involving people’s livelihoods.

“Pension reform is the most urgent issue in this age,” Lee said as he magnanimously offered — much to the PPP’s surprise — to go along with the governing party’s proposal of adjusting the income replacement rate to 44 percent. The governing front could not decipher whether Lee is genuine in the reform drive or was just pulling another political show to steal the limelight. His sincerity would be known by the way the majority party addresses the pension reform in the new legislature which opened on Thursday.

Regardless of the DP’s intent, it was hard to comprehend the response from the presidential office and the PPP. Eagerness to tackle the urgent calling of the age is required as the highest virtue from the ruling front. Overhaul of the national pension is undoubtedly the most imperative issue. The universal pension program is fast withering by the accelerated population decline and rapid aging. At the current pace, the pension will run out of reserves by 2055. By 2093 — when newborns in 2023 turns 70 — the deficit will top 21.7 quadrillion won ($15.7 trillion) with 50 trillion won adding to the red every year. Despite the urgency, the governing party at the cue of the presidential office has carried over the reform mission to the next legislature.

The PPP contends that pension reform should be a comprehensive one touching on structural fixes. In theory, it is right. A structural reform would be a fundamental overhaul by tying the first-tier basic pension to the second-tier contribution-based national pension and designing an automatic adjustment mechanism to respond to demographic changes, as well as addressing other public pensions like government employees’ pensions.

The task will be much more difficult and complex than tweaking the headline numbers — the contribution rate (premium) and the old-age compensation rate (income replacement rate).

Changes to the basic income cannot be easy, given the high poverty rate among the elderly. Fixing the government employees’ pension can stoke a strong protest from public-sector workers. An incremental reform starting with the adjustments to the cost and benefit — and a drastic reform of the pension system — both bear merits and demerits. But what’s important is that the PPP has never mentioned a structural reform until now. We do not know what ideas the government and party have. They must be able to provide the blueprint for their argument to have any foundation. If not, the PPP is merely delaying an urgent operation on an emergency patient by demanding a full health checkup first. This is why it appears to be cowardly. It is not fit to be a governing party if it balked at an immediate bipartisan deal because it feared Lee would entirely take credit for the pension reform. That would mean the party had placed its interest ahead of the public’s.

The ruling front lacks the 3Cs — competence, clout and commitment. It is why the policies it concocts are one disappointment after another, as seen in its recent proposal to ban online purchases of overseas products if they do not bear the Korea Certification (KC) mark. Policy failures can happen. But the absence of commitment by the government cannot be condoned.

The PPP has succeeded in killing a motion to appoint a special prosecutor to investigate the government’s handling of the suspicious death of a Marine, all thanks to a presidential veto. To sabotage the bill, however, the party victimized other important bills by boycotting all standing committee meetings. All the painstakingly-drawn bills to help people’s livelihoods went down the drain. How can it call itself a party prioritizing the people?

There is a saying about “winning the battle, but losing the war.” The PPP may end up exactly like that. People will be closely watching how fairly the Corruption Investigation Office for High-ranking Officials (CIO) will investigate the presidential office’s alleged pressure on the military’s investigation of the Marine’s death. The PPP will have to take responsibility for the delayed reform of the national pension. The governing party does not have much time — and sadly, it appears to be unaware of that.