By Chung Li-hua and Fion Khan / Staff reporter, with staff writer and CNA
The Executive Yuan yesterday proposed amendments to the National Pension Act (國民年金法), with the government expecting to invest about NT$86 billion (US$2.72 billion) annually and an estimated 1.76 million people set to benefit.
The draft changes aim to raise benefit levels, ease means-testing thresholds and introduce a mechanism to adjust payments in line with price changes, the Cabinet told a news conference in Taipei.
The proposed amendments would significantly boost several payout categories, Ministry of Health and Welfare Department of Social Insurance Director-General Chang Yu-hsuan (張鈺旋) said.
Photo: Tyrone Siu, Reuters
The basic monthly guaranteed amount for pensions would rise from NT$4,049 to NT$5,000, an increase of 23.5 percent, while the basic guaranteed disability pension would be raised from NT$5,437 to NT$6,715, she said.
The adjustments would help recipients cope with rising prices and maintain their basic purchasing power, the ministry said.
The proposed amendments would also relax “wealth exclusion” clauses to ensure that fewer people are disqualified due to asset valuations.
The annual personal income threshold would be raised from NT$500,000 to NT$600,000, while the real-estate asset cap would be adjusted to NT$10.25 million, the draft says.
To prevent people from losing pension eligibility because they own and live in a house, the cap on deductions for self-occupied residences would be removed, so such properties would no longer be included in asset calculations, it says.
To ensure that benefits better reflect price fluctuations and preserve real purchasing power, adjustments to the basic pension amounts would no longer be limited to reviews every four years, the draft says.
If the cumulative increase in the consumer price index reaches 3 percent within two years, an immediate adjustment could be made, it says.
Requirements that spouses pay premiums for the insured would also be removed.
Currently, spouses who fail to pay premiums on behalf of the insured within a stipulated period face fines.
Asked whether the changes would help boost participation in the national pension program, Deputy Minister of Health and Welfare Chuang Jen-hsiang (莊人祥) said he hoped they would lead to higher contribution rates.
The cumulative contribution rate for the national pension is about 60 percent, rising to about 90 percent among those aged 65 or older, he said.
The national pension is designed to allow people to continue accumulating contribution while transitioning between jobs, enabling them to receive higher retirement benefits while being covered by labor insurance during their working years, he said.
The bill is to be sent to the Legislative Yuan for deliberation.
If the increased benefits are to be implemented from this year, the funding could only be allocated after the central government’s general budget completes statutory procedures, the Cabinet said, adding that it would need to be covered through a supplementary budget of NT$16.98 billion.