The money to pay civil servants and the soldiers' pension


◆ National Treasure with red light ◆

Last year, Korea's national debt increased by 126.9 trillion won to 1682 trillion won. It is due to an increase of 94 trillion won in natadon (pension provision) that employees and soldiers must prepare for retirement after retirement. The increase in pension liabilities accounted for 74% of the total debt increase.

According to the government report on the National Accounts for Fiscal Year 2018, which was approved by the Council of Ministers on June 2, the value of the pension provision among the total national debt (1682.7 trillion won) was 939.9 trillion won.

The civil servant's pension liability is 753.9 trillion won and the liabilities of military pensions are 186 trillion won. The pension provision accounted for 56% of the total national debt. Treasury bonds and savings on underwriting accounted for less than half of the total.
Pension provisions increased from 643.6 trillion won in 2014 to 659.9 trillion won in 2015, 752.6 trillion won in 2016 and 845.8 trillion won in 2017.

The increase in pension provision last year was attributed to the increase in the number of civil servants and military personnel and the number of pensioners. In particular, the government is trying to increase the number of civil servants and soldiers in order to expand jobs, raising concerns that the rate of increase in national debt may increase. The government plans to increase 174,000 civil servants by 2022. According to estimates by the National Assembly's budget policy office, it is estimated that the number of public servants' pensions to be spent by the state is 92.4 trillion won, number of civil servants increases by 174,000 by 2018 ~ 2022.

In this regard, the Ministry of Strategy and Finance explained that the increase in the number of civil servants did not have a major impact on the increase in pension provision.

Lee Seung-cheol, deputy finance manager for the Ministry of Finance and Economics, said: "Public authorities retire for a year after joining the company, so last year's accounts reflect the provision of retirees for 2017" . And the debt is worth 75 billion won. "

The recent decline in the discount rate to 3% due to low interest rates is also attributed to the increase in the provision for pension provision.

When calculating the pension provision, the discount rate that converts the future value into present value is applied. At the time of the low interest rate, the discount rate decreases and the present value of the debt becomes quite large. According to the statement, 85% of the increase in total pension liabilities of 94.1 trillion won, or 79.9 trillion won, was due to financial factors such as cuts in the discount rate.

▷ pension liability: it is the virtual debt that estimates the present value of the pension amount to be paid to future pensioners and holders in the long term. It is not the money that the government lends directly, but if the pension amount is not enough to be paid in the future,

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[ⓒ 매일경제 &, 무단전재 및 재배포 금지]


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