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Reducing the high rate of poverty among the elderly in Korea

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  • Reducing the high rate of poverty among the elderly in Korea
  • Jones, Randall S.; Urasawa, Satoshi
  • OECD


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Title Reducing the high rate of poverty among the elderly in Korea
Similar Titles
Material Type Reports
Author(English)

Jones, Randall S.; Urasawa, Satoshi

Publisher

[Paris]:OECD

Date 2014-09
Series Title; No OECD Economics Department Working Papers / 1163
Pages 34
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < General
Social Development < Population
Holding OECD

Abstract

One-half of Korea's population aged 65 and over lives in relative poverty, nearly four times higher than the OECD average of 13%. Elderly poverty is thus an urgent social problem. The immediate priority is to target the Basic Old-Age Pension on the lowest-income elderly to ensure that they escape from absolute poverty. The Basic Livelihood Security Programme should be used to top up the income of poor elderly by further relaxing eligibility requirements. In addition, reforms are needed to develop an effective three-pillar system of retirement income based on the National Pension Scheme (NPS), company pensions and individual savings. Making the NPS more effective in reducing elderly poverty requires expanding its coverage, focusing on improved compliance among non-regular and self-employed workers, lengthening average contribution periods and maintaining the NPS replacement at around 50%, keeping it close to the OECD average. The increase in the contribution rate should begin as soon as possible, as delays would only make the necessary increase larger.