CNA

TAIPEI, Taiwan — President Ma Ying-jeou declared yesterday, the inauguration day of the new national pension system, that Taiwan’s social security system is now more comprehensive, setting a milestone for the country.

At a press conference to launch the system, Ma said that together with the National Health Insurance Program and other insurance programs, the new pension system will consolidate Taiwan’s social security network, ensuring that the whole population is covered by insurance.

The national pension system will be open to anyone with household registration in Taiwan aged between 25 and 65 who is not covered by other social welfare insurance such as farmer’s health insurance, government employee insurance, insurance for military personnel and labor insurance.

Noting that the country’s population is aging, Ma said that “even if there will be fewer people to support elderly citizens in the future, we don’t have to worry, since the national system is now established.”

According to the Ministry of the Interior (MOI), people over 65 are expected to account for 20 percent of the country’s population by 2026, and in 2030, every senior citizen will have only three working people to support them, down from the present seven.

“From now on, Taiwan is in an era in which the entire population can be covered by insurance, and the country’s social security network is complete,” Premier Liu Chao-shiuan said at the press conference, adding that with the new system, the government has taken a further step in taking care of the underprivileged.

In the first year of the new system’s implementation, the monthly premium is decided based on the basic minimum wage, which is NT$17,280 (US$539.5) at present.

The premium rate for the insurance is 6.5 percent for the first year, to be increased by 0.5 percent in the third year and thereafter by 0.5 percent every two years until it reaches a limit of 12 percent.

The insured must pay 60 percent of the premium, while the central competent authority will be responsible for the remaining 40 percent.

Under the regulations, an insured person who pays a monthly premium of NT$674 for 40 years will receive NT$8,986 every month from the age of 65 — the standard retirement threshold — until death.

But low-income citizens and mentally and physically disabled people can enjoy from 55 percent to 100 percent of premium subsidies from the government, according to the MOI.

In addition, to safeguard women’s right, husbands should pay the premiums for their spouses if they are full-time housekeepers, noted Interior Minister Liau Liou-yi.

According to the National Pension Act,funding for the subsidized premiums and related expenses should be appropriated by the central competent authority. Apart from annual budget, the surplus from the public welfare lottery for the national pension and an increase of business tax by 1 percent could also contribute to the available funds.

The MOI said the new system will cover an estimated 4.7 million people,including the jobless,street vendors,housekeepers, naturalized foreign spouses and students older than 25. The amendment to the National Pension Act was approved by the Legislative Yuan in July 2008.