[Edaily Reporter Bang Bo-kyeong ] Initiatives aimed at strengthening retirement income security by extending the National Pension enrollment period have failed to fully achieve their intended goals. This is because applicants have been concentrated in affluent areas such as the three districts of Gangnam, and only 1% of discharged military personnel have utilized the system for retroactive payment of premiums during military service.

During the National Assembly Health and Welfare Committee’s parliamentary audit of the National Pension Service held on the 14th at the National Assembly in Yeongdeungpo-gu, Seoul, Representative Jeon Jin-sook of the Democratic Party of Korea stated, “Of the 1,720 applications received for the first round of National Pension premium subsidies, 543 were from Gyeonggi Province and 294 from Seoul,” and “Not only are applications concentrated in the Seoul metropolitan area, but the number of applications from the ‘Gangnam 3 Districts’—Gangnam, Seocho, and Songpa—is also significantly higher than in other regions,” she pointed out.

With the National Pension, the longer the enrollment period, the higher the pension amount received in retirement. This is the rationale behind the government’s design of numerous programs aimed at extending the enrollment period. If individuals pay premiums and build up an enrollment history in their teens or twenties, they can have that period recognized as part of their enrollment period even if they are unable to pay premiums for a while afterward, provided they make up the payments later.

A prime example is the “Youth First-Time Premium Support Program” mentioned by Rep. Jeon. This recently established program provides a premium subsidy of 41,000 won to young people turning 18.

Pre-registration began on the 1st of this month, and as of the morning of the 6th, 1,729 applications had been received. However, critics have pointed out that since applicants are concentrated in the Seoul metropolitan area, access to information is directly leading to economic disparities.

Voluntary enrollees are also concentrated in the three districts of Gangnam. According to Representative Jeon, teenage voluntary enrollees—who voluntarily enroll and pay premiums despite having no income—are concentrated in these three districts. Conversely, regions with low enrollment rates were often those facing economic hardship or at risk of depopulation.

Representative Jeon stated, “Although it is the same system, in some regions it is being used as a financial investment tool to secure enrollment periods in advance,” adding, “Since parents’ access to information influences the use of the system, shouldn’t we be considering how to identify the root causes and devise countermeasures?”

He also noted that the military service retroactive payment system is not functioning properly. Introduced in 1999, the system saw the number of applicants rise to 18,118 last year, but this figure remains woefully small compared to the total number of military veterans. Former Representative Jeon stated, “While 4.55 million people have been discharged from the military since 1999, the cumulative number of applications amounts to only 0.93 percent—less than 1 percent.”

According to simulations, utilizing these programs can increase monthly pension benefits by up to 340,000 won. By using the military service retroactive payment system, one can receive a total of 12.35 million won over 15 years compared to not making the retroactive payments. In the case of the “First-Time Pension Premium Support Program for Youth,” making retroactive payments for 119 months after the initial premium support results in an additional 61.56 million won over 15 years.

Former Representative Jeon stated, “To ensure income security in old age, it is important to properly inform the public about these programs and encourage enrollment and retroactive premium payments,” adding, “Since support is currently only available to those who apply, extraordinary measures are needed.”

Kim Seong-ju, Chairman of the National Pension Service, replied, “We are repeatedly posting information about the first-premium subsidy and credit support on social media,” adding, “Once the program is fully implemented next year, we plan to visit high schools and military bases directly to provide explanations.”