Raising Basic Pension Eligibility Age Could Save 600 Trillion Won by 2065

The government is considering raising the starting age for Basic Pension payments to reduce future fiscal burdens caused by low birth rates and an aging population.

According to related research, gradually increasing the eligibility age for the Basic Pension could save approximately 600 trillion won in pension finances by 2065. This study was conducted by the Hongik University Industry-Academia Cooperation Foundation under a government contract and includes proposals to raise the eligibility age for the Basic Pension, which is currently provided to 70% of the population aged 65 and over.

The report analyzed three scenarios for raising the Basic Pension eligibility age. The first scenario involves increasing the age by one year every five years starting in 2033, reaching 70 by 2058. Under this scenario, pension finances are estimated to be reduced by 203.8 trillion won between 2025 and 2065 compared to the baseline. The second scenario proposes raising the age to 70 by increasing it by one year every two years starting in 2027. Applying this scenario would decrease financial outlays by 372.5 trillion won over the same period. The third scenario links the age increase to remaining life expectancy, aiming to raise it to 75 by 2056. This scenario estimates pension finances savings of 603.4 trillion won by 2065.

The government has begun work on revising the Basic Pension system, with Finance Minister Park Hong-keun indicating the possibility of finalizing revision plans within the year. The revised plans could potentially be reflected in next year's budget.