국민연금의 소득보장효과에 대한 Simulation 분석 = A Study of the Income Security Effect of National Pension Scheme in Korea

다국어 초록 (Multilingual Abstract)

The present study is concerned more on how the basic principles of public pension designs affect individual participants and on providing basic materials for enhancing the equity of public pension schemes. This study utilizes a number of micro-simulation models to analyze how the effect of public pension schemes varies across workers of different income levels. Unlike many other studies relying on the assumption of stable lifetime income, the present study assumes three different types of career earnings: `rising`, `rising-then-level`, and `level`. Each type is further assumed to consist of low-income, middle-income, and high-income groups. The simulation model applied to NPS therefore consists of 9 cases (three income groups for each of the three earnings types), each classified further into male and female groups. Also, these cases are analyzed in terms of the period of participation and the year of participation. The method of analysis is as follows: the effect of public pension on lifetime income; benefit-to-cost ratio; benefit rate and income replacement rate. Main findings and policy suggestions is as follows. First, although the income replacement rate for NPS participants is expected to increase as the scheme matures, NPS benefits alone do not suffice to allow individual pensioners to lead a decent and stable post-retirement life. This calls for further efforts to seek ways to supplement public pension programs with personal and corporate pension plans. Second, although the benefit levels the public pension schemes guarantee are low by absolute standards, the total benefit an earlier participant can expect, as seen above, amounts to 1.6∼3.6 times the total contributions he or she will have paid in, implying that the pension funds with which to pay benefits to later participants are likely to deplete. This suggests that remedial measures must be taken urgently to improve the benefit-contribution structure of the public pension schemes. Third, if the contribution rate gets raised to ensure NPS`s financial structure, its benefit-to-cost ratio is likely fall down below 1.0. Under this scenario, there would be little incentives left for future working generations to participate in the scheme, and more and more people are likely to advocate that the scheme be abolished. Therefore, the benefit-to-cost ratio should be maintained above 1.0 for every generation. Fourth, the current retirement allowance plan, as shown in this study, has a considerable income-generating effect, will have to be converted into mandatory corporate pension to supplement the public pension schemes, particularly for high-income workers for whom the income replacement rate is way too low to meet their pre-retirement consumption level.