Changes for civil servant retirement plans discussed; cuts considered

Amid debate surrounding issues of civil servants' retirement benefits contrasted with the nation's financial difficulties, government officials have vowed to begin reformation on the nation's retirement annuity systems.

According to Chang, the reformed system would require an older age or longer working-year cap for civil servants to reach before they apply for retirement. For instance, the original “85 system,” where years of employment plus desired age of retirement equals or exceeds 85 — would convert to a “90 system,” according to Chang's report.

As officials are working toward shortening the gap between the labor and civil servant benefits, Chang introduced a new pension system that is similar to the labor retirement plans.

The new civil servant retirement program would impose a dual-track plan, similar to the labor retirement program, which runs on the labor pension and labor insurance plan. According to the labor pension plan, employers are required to deposit 6 percent of a worker's monthly wages into an individual labor pension account managed by the government bureau.

The current law indicates that a portion of the civil servants' monthly wages goes into a retirement pool, where the government also contributes a large portion. They do not have an individual pension account when they collect their retirement, but a set retirement pay that is calculated according to their employment years and salaries.

According to officials, the new civil servant retirement system would make it so that future civil servants would not enjoy such generous benefits as in the current system. Nevertheless, officials added that this would lessen the gap between the laborers and civil servants.

Chang added that the wage replacement rate and the exceptional 18-percent interest rate were all being discussed and may face reform.

Civil Servants Angered by Reform

In response to numerous comments made by Minister of the Examination Yuan Kuan Chung on civil servants, representatives of public servants have expressed disappointment.

Chairman of the Civil Servant Association under the Council of Labor Affairs (CLA) Li Lai-hsi (李來希) complained that the reform systems were drafted without the opinions of the civil servants, which was degrading and disrespectful.

Li also lashed out at Kuan for using extreme examples of the civil servant's benefits to mislead the public, saying that it was an injustice and unfair to public servants.

He added that the association is prepared to propose their own version of the civil servant retirement system. “As civil servants are a big portion of Taiwan's workforce, we have the advantage of more votes,” he said.

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