Gov't suggests 75% pension payment cap
The China Post news staffTAIPEI, Taiwan -- The Ministry of Civil Service (MOCS) delivered yesterday a report on reforming the retired civil servants' pension system, including extending the eligible age for retirement payments to 65 and limiting the total payment to 75 percent of their salaries, down from the current 95-percent cap.
January 26, 2013, 12:02 am TWN
In the report to the members of the Examination Yuan, the MOCS estimated that the government will be able to save between 20 to 30 percent in overall pension payments under the new system.
The new rules are scheduled to take effect in 2016.
According to the planned revisions, the eligible age for most of the retired government employees to draw annuities will be raised by five years to 65, said Civil Service Minister Chang Che-shen.
Under the current system, implemented in 2011, the retirees are eligible to receive annuities when reaching 60 years old after 25 years of service, or when reaching 55 after serving for 30 years.
But the new rules will increase the qualifying age to 65 after 25 years of service, or to 60 for those who have served for at least 30 years.
Chang said the new measures will also push the government and employees themselves to jointly contribute to the retirement fund.
To reduce resistance to the reforms, the government will work out complementary measures involving tax incentives and investment products to help boost the fund and ensure its financial solvency.
The MOCS did not mention yesterday any concrete plans concerning the preferential annual interest earnings of 18 percent that civil service retirees are entitled to.
But Chang stressed there will definitely be certain adjustments to the rules about the controversial interest payment.