A president's reprimand, and a minister's discomfort

Shin Sung-sik

The author is a welfare specialist reporter at the JoongAng Ilbo.

The atmosphere at the 45th Cabinet meeting on Oct. 20 turned tense for three minutes. President Lee Jae Myung resembled a scolding teacher, while Health and Welfare Minister Jung Eun-kyeong looked like a chastened student.

Lee interrupted Jung nearly 10 times, raised his voice, demanded to know the reason four times and sighed in frustration. At times, his language became unusually blunt. Jung maintained an awkward expression throughout. Lee's words took 1,070 Korean characters, compared to Jung's 429.

The dispute concerned a government plan to cover one month's National Pension Service (NPS) contribution, worth 42,000 won ($30), for 18-year-olds. Starting in January, eligible young people must apply to receive the benefit. Alongside abortion medication and universal menstrual products, the initiative exemplifies Lee's attention to detailed welfare policies.

Why did this seemingly minor issue provoke such anger?

People aged 18 to 27 are generally exempt from mandatory pension contributions while studying or serving in the military. However, making even one payment allows them to make additional contributions retroactively later, increasing their eventual benefits.

Since his days as Seongnam mayor, Lee has argued that only young people whose parents understand the system benefit from this arrangement, creating inequity. As Gyeonggi governor in 2018, he sought automatic government payments for 18-year-olds. But then-Health Minister Park Neung-hoo opposed the proposal, arguing that government-financed contributions contradicted social insurance principles.

Automatic support is not inherently harmful. Those who dislike the arrangement can simply decline to make retroactive payments. Lee argued that young people had no reason to object and that opposition stemmed from misunderstanding.

He pressed Jung to explain whether NPS finances were the real concern. Jung replied that officials had debated automatic enrollment but ultimately adopted applications to preserve individual choice.

Automatic support would indeed cost more, as Lee suggested. Yet another factor influenced the decision. Following last year's presidential election, the State Affairs Planning Committee revised the pledge after opposition from young people.

Many distrust the pension system, fearing they will contribute throughout their working lives without receiving benefits. An official familiar with the discussions recalled strong objections from young people who believed the government was trying to bind them to the pension system.

Why force them into participation merely to provide one month's contribution? Their reaction illustrates how deeply pension distrust has taken root.

Confucius taught that a nation cannot stand without public trust. Imposing automatic enrollment amid widespread suspicion could deepen that distrust.

Lee has consistently advocated replacing application-based welfare with automatic benefits. That approach works for universal programs such as child allowances and parental benefits. But the initial pension contribution for 18-year-olds raises different considerations.

Lee has also repeatedly questioned pension payments to foreigners, citing suspected abuse of NPS and basic pension benefits. At the Cabinet meeting, he demanded action against those who improperly received payments.

Recovering unlawfully obtained benefits is necessary, whether recipients are Korean or foreign. Singling out foreigners, however, risks appearing discriminatory.

Meanwhile, suspicions have emerged this year that the National Pension Fund is being used to support stock prices, an unusual controversy.

When stocks rose in May, Lee said he had heard that the fund's projected depletion date had been postponed by 20 to 30 years. Markets have since fallen, changing that calculation.

Assessing pension sustainability according to short-term market fluctuations is unusual. The law requires comprehensive actuarial assessments every five years, incorporating economic growth, demographic trends and other factors.

Detailed initiatives such as subsidizing the first contribution for 18-year-olds can be left to ministries. The president has more consequential pension challenges demanding attention.

These include reforming civil servants' and private schoolteachers' pensions, along with basic pension reforms that previous governments attempted but abandoned.

Such structural reforms would do more for younger generations than disputes over automatic enrollment.

Former President Roh Moo-hyun pushed through national pension reform through persistent persuasion. Former President Park Geun-hye reformed civil servants' pensions. Pension reform became a defining achievement of both presidencies.