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Gov't pours W14t into covering pension funds deficit over past 5 years

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Published : 2014-04-13 11:22
Updated : 2014-04-13 11:22

The government has poured almost 14 trillion won ($13.5 billion) into the pension funds for public servants and soldiers over the last five years to cover their deficit, data showed Sunday.

The government pumped a combined 13.9 trillion won to plug losses by the pension funds from 2009-2013, according to the finance ministry, and around 3.8 trillion won may go to covering the two pension funds' deficit this year, up from 3.3 trillion won tallied for last year.

The growing deficit threatens to weigh on the government's finances as the country's low birthrate and aging population will taxpayers declines.

The government's pension provisions for public servants and soldiers came to 596.3 trillion won last year, accounting for 53.3 percent of the total national debt worth 1,117.3 trillion won, the finance ministry noted.

The hike in national debt mainly came from an increase in the estimated amount of money that the government will have to give to beneficiaries in the future.

The government earlier said that it may have to increase spending for the pension funds by an average of over 10 percent a year, adding that such expenditures may reach 16.7 trillion won in 2017, compared with 10.9 trillion won recorded for last year.

Experts have suggested that the pension fees need to be raised, stressing that it's urgent to reform such pension funds in a bid to reduce the use of taxpayers' money to cover the deficits.

The combined deficit of the pension fund for public servants has reached 9.8 trillion won, and the pension pot for the fund for soldiers has already been depleted, according to the government. (Yonhap)

 

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