South Korea’s state pension payment to the retirees is estimated to exceed 30 trillion won ($21.5 billion) for the first time this year, raising concerns that the country’s pension fund would be completely depleted faster than expected amid the fast-ageing population with plummeting birthrates.

According to data released by the Ministry of Economy and Finance on Wednesday, the country’s state pension fund National Pension Service (NPS) is expected to pay a total of 30.61 trillion won in its pension fund in 2022, breaking the 30-trillion-won threshold for the first time this year.

State pension payment has been on the fast rise year after year from 3.58 trillion won in 2005 to 15.18 trillion won in 2015, 20.75 trillion won in 2018, 25.65 trillion won in 2020, and 29.14 trillion won in 2021.

The number of pensioners has been growing rapidly as well, indicating the fast ageing of the society – 1.65 million in 2005, 2.82 million in 2010, 4.14 million in 2016, and 5.39 million in 2020. As of the end of May this year, the number reached 6.05 million.

The National Assembly Budget Office says the growth pace will accelerate further, and the pensioners will jump to 8.74 million by 2030, 12.9 million by 2040 and 16.89 million by 2060. At this rate, NPS’s asset reserves are estimated to increase from 740 trillion won in 2020 to 1,027.7 trillion won in 2030 and then dry out by 2055.

Worse is NPS’s fund management performance this year. Its half-year return as of the end of June this year came at minus 8 percent, with 882.65 trillion won in assets under management, down 76 trillion won from six months ago.

The government now is preparing to publish a fiscal outlook report for the next 70 years in 2023. With the report, the government and the National Assembly will draw up measures for a fundamental change in national pension policy and situation.

The country’s monthly premium rate has been maintained at 9 percent for 24 years since the first rise in 1998 from 3 percent. Some experts advise to up the rate while reducing the benefit.

By Lee Jong-hyuk and Lee Ha-yeon

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