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Uncollected basic pensions top nearly W400b since 2014

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Published : 2017-03-19 16:25
Updated : 2017-03-20 08:50

The outstanding amount of unpaid basic pensions in South Korea has reached almost 400 billion won ($353.6 million) over the past two years, due largely to a decline in pension applications, parliamentary data showed Sunday.

The outstanding balance of uncollected basic pensions stood at 398.7 billion won at the end of 2016, with the payment rate coming in at 65.6 percent, or 4.58 million out of 6.98 million pensioners aged over 65, according to a parliamentary report submitted to the Ministry of Health and Welfare. 

The payment rate has barely changed, standing at 66.8 percent in 2014 and 66.4 percent in 2015, hovering below the government's target rate of 70 percent, the data showed. 

The Ministry of Health and Welfare (Yonhap)

The number of pension recipients have increased to 106,000 in 2016, compared with 69,000 in 2014 and 82,000 in 2015. 

The failure to meet the target rate in pension payments is largely attributable to some pensioners' reluctance to receive the benefits because they want to avoid disclosing their income or assets to the government when they apply for the entitlements, the report said. 

In 2014, the government introduced the basic pension system in which every pensioner over the age of 65, except those whose annual income is in the top 30 percent category, gets a monthly pension of around 200,000 won.

By region, South Jeolla Province recorded the highest payment rate of 81.8 percent in 2016, while Seoul recorded the lowest payment rate of 52.7 percent, the data showed. (Yonhap)