Gov't considers broad pension limits after foreign retroactive payment controversy
The National Pension Service is reviewing tighter retroactive contribution rules for all subscribers, including lower caps and minimum regular payment periods.
A visitor receives counseling at the National Pension Service’s office in Seodaemun District, western Seoul, on June 29.NEWS1
After tightening retroactive pension contribution rules for foreign nationals, the government is now considering an overhaul of the system itself that would apply to both Korean and foreign subscribers.
The Ministry of Health and Welfare and the National Pension Service (NPS) commissioned a study to examine problems with the current retroactive contribution system, pension authorities said Thursday. Options under review include limiting the number of months a subscriber can make retroactive contributions to the number of months they have actually paid regular premiums, as well as reducing the current 119-month cap.
The retroactive contribution system allows National Pension subscribers to pay premiums later for periods when they were unable to make contributions due to unemployment, business suspension, career breaks or other reasons, thereby extending their contribution period. Subscribers need at least 120 months, or 10 years, of contributions to qualify for an old-age pension.
The review follows recent controversy over retroactive contributions by foreign nationals, amid reports of some foreign nationals qualifying for lifetime pensions after making just one month of contributions and paying the remaining 119 months retroactively.
The Health Ministry and NPS tightened rules for foreign nationals, allowing them to make only retroactive contributions for past periods when they actually lived in Korea.
However, a government probe later found only three cases of people applying for lifetime pensions after paying a single month of regular premiums and 119 months retroactively, with all three living in Korea for the periods they paid for.
Amid the controversy, the NPS is considering tightening rules for all subscribers. The NPS plans to consult with the Health Ministry based on the findings of the commissioned study and go through necessary legislative revisions with the National Assembly.
The NPS is reportedly considering allowing retroactive contributions only for subscribers who have made regular premium payments for a minimum period, such as at least one, three or five years.
A person walks into a National Pension Service office in Seodaemun District, western Seoul, on June 29.NEWS1
Other options include determining the eligible retroactive contribution period in proportion to the period of regular contributions and substantially lowering the current 119-month cap.
Restrictions on when subscribers can apply for retroactive contributions and the circumstances under which they can do so are also under consideration.
The government has already tightened retroactive contribution requirements for foreign nationals following the recent controversy. Starting Monday, foreign applicants must submit immigration records to prove they actually lived in Korea during the period for which they wish to make retroactive contributions. A month counts toward the eligible retroactive contribution period only if the applicant actually lived in Korea for at least 15 days that month. Retroactive contributions are not allowed for periods spent overseas.
The government also plans to extend the principle of reciprocity to retroactive contributions. Under the plan, nationals of another country would be allowed to make retroactive contributions in Korea only if that country grants Koreans living there the same right.
Oversight of pension recipients living abroad will also be strengthened, with the government checking whether overseas recipients are alive twice a year, up from once a year currently.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
