Faced with the possible bankruptcy of Taiwan's pension system over the next decade, President Tsai Ing-wen (???) has said she would like to see related reform bills pass the legislature next summer, preferably before her one-year anniversary in office on May 20, 2017.
Tsai set the dateline during a meeting with editors-in-chief and their deputies from Taiwan's major newspapers on Sunday, saying that pension reforms are "necessary" and "urgent" given limited national and social resources, according to reports of the meeting on Monday.
It marks the first time Tsai scheduled the important reform of the country, which was brought up in the previous Ma Ying-jeou government.
The reports cited Tsai as saying that the core goal of pension reform is to maintain the financial sustainability of various pension schemes -- at least for one generation -- and to ensure retirees are financially secure in their old age.
Pension reform is a priority policy for the Tsai government, which established a national pension reform commission under the Presidential Office to promote the reforms in May.
Over the past six months, the commission has held 20 meetings to outline reform proposals and starting on Dec. 31, will hold four forums in northern, central, southern and eastern areas of the country to encourage public debate on the proposals, as well as those drafted by the Cabinet's pension reform office.
A national affairs conference will be held on Jan. 21-22 so that bills to revise related laws, including the Civil Service Retirement Act and the Public Service Pension Act, can be drafted and delivered to the Legislature for review in its next session, which is scheduled to start in February.
Tsai has expressed hope that the amended bills will clear the legislative floor by May 20 so that the reforms can be officially introduced, three to four months earlier than the Cabinet had scheduled, news reports said.
According to reform plans drafted by the Cabinet's pension reform office, the insurance rate of pension programs for public servants and teachers will be gradually increased from the current level of 8-15 percent to 18 percent, and that of the pension program for employees with covered by labor insurance from the current 6.5-12 percent to above 18 percent.
The reform plans also includes a stipulation that retirees will only be able to begin drawing their contributory benefits at the age of 65. The proposal was designed to eliminate the link between retirement date and pension payment, according to the office.
The ratio of monthly pension to wage will also be gradually adjusted reduced to 60-70 percent of insured salary before retirement, the office said.
As for the controversial 18-percent preferential interest rate on savings deposits for public sector employees, Minister without Portfolio Lin Wan-i (???), who serves as deputy convener of the national pension reform commission under the Presidential Office, has said this scheme will be eliminated within the next six years.
The main spirit of the planned reforms will be "paying more, receiving less and deferring retirement" while equalizing the different pension programs, according to Lin.
Source: Focus Taiwan News Channel