The Korea Herald

지나쌤

Constitutional argument erupts over public-sector pension reform

By Korea Herald

Published : Oct. 29, 2014 - 21:26

    • Link copied

The drive to reform the Government Employees Pension program may face more obstacles with opposition lawmakers calling for more time, while others claim it may violate the Constitution.

According to the civil servants’ union, levying a fee on retired government employees to contribute to stabilizing the system’s finances would infringe on their right to hold property through a revision that will be applied retroactively to them, which is specifically ruled out by the Constitution.

Article 13 of the Constitution states that citizens will not “be deprived of property rights by means of retroactive legislation.”

The reform plans drawn up by the ruling Saenuri Party include levying a “finance-stabilizing contribution” from retired government employees. The fee would range from 2 percent to 4 percent depending on the monthly payout drawn by each retiree.

The plans would also delay the age at which retired civil servants can begin drawing on the system to 65, and increase the payments while reducing the payouts. According to the party’s estimates, its plans would save the government 442 trillion won ($422 billion) by 2080.

The ruling party, which proposed the bill outlining such changes as its official position, is also citing the Constitution to support its cause.

While the naysayers cite Article 13 of the Constitution, the ruling Saenuri Party has cited Article 37 to defend its plans.

Article 37 states that “freedoms and rights of citizens may be restricted by an act only when necessary for national security, the maintenance of law and order or for public welfare.”

“Levying the fee on retired civil servants is aimed at achieving “public welfare” that is stabilizing the finances of the pension system, so it does not violate the Constitution,” Saenuri Party Rep. Lee Han-koo, who heads the task force on reforming the public sector pension system, told reporters.

In addition, the Constitutional Court’s 2003 ruling upholding the clause of the Public Officials Pension Act that allows the government to halve the payout if a retiree secures a new source of income is considered likely to work in the ruling party and the government’s favor.

However, the main opposition New Politics Alliance for Democracy is unlikely to allow the issue to be handled on the timeline suggested by the government and the ruling party.

“Trying to change the pension system one-sidedly is wrong. There must be an accord with concerned parties and consideration for other pension systems such as the national pension,” NPAD Rep. Kim Sung-ju said in a radio interview on Wednesday.

“It is difficult to comprehend why President Park Geun-hye is suddenly claiming that it should be processed within the year.”

By Choi He-suk (cheesuk@heraldcorp.com)