PensionsSouth Korea
National Pension reform of 2025: contributions from 9% to 13%, replacement rate of 43%
Adopted by the National Assembly on 20 March 2025 and in force since 1 January 2026, the amendment to the National Pension Act raises the contribution rate — unchanged at 9% since 1998 — by 0.5 point a year to 13% in 2033, sets the nominal replacement rate at 43% instead of letting it fall to 40% by 2028, writes the State’s guarantee of payment into the law and extends childbirth and military-service credits. It is the first parametric reform since 2007; the structural reform is left to a special committee of the Assembly.
Updated: November 5, 2026Next milestone: January 1, 2027 — Contribution rate rises to 10%; extended military-service and second-child credits take effect
At a glance
Reference text
국민연금법 일부개정법률 (Act partially amending the National Pension Act), Act no. 20903 of 2 April 2025[1]
No. 법률 제20903호 · April 2, 2025
Read the text ↗Carried by
- Cho Kyoo-hong (조규홍)[7][8][1]Minister of Health and Welfare — government reform plan of September 2024, then the 2025 act · 2024-2025 · Initiator
- 보건복지위원회 (Health and Welfare Committee, National Assembly)[4]Committee of the National Assembly that drafted the alternative bill no. 2209191, tabled by its chair, merging 24 bills · 2025 · Initiator
- Jeong Eun-kyeong (정은경)[12][14][3]Minister of Health and Welfare — implementation from 2026 and the follow-up amendment of October 2026 (Act no. 22096) · 2025-2026 · Implementation
Implementation
- Ministry of Health and Welfare (보건복지부)
- National Pension Service (국민연금공단) — benefits; National Health Insurance Service — collection of contributions
Stated objective
Strengthen both the sustainability of the National Pension and its role in securing income in old age; restore public trust by stating that the State guarantees payment; reward military service and childbirth; and narrow coverage gaps among low-income self-employed members.[4][1][8]
According to the statement of reasons of the alternative bill (Health and Welfare Committee) and the Ministry of Health and Welfare
Contribution rate at the end of the schedule
13%
from 2033 · according to Act no. 20903 (art. 88 and addendum art. 4)[1][8]
Of gross reference monthly income; 9% since 1998.
Nominal replacement rate
43%
from 2026 · according to Act no. 20903 (art. 51)[1][12][13]
For an average earner insured for 40 years; applies only to periods contributed from 2026.
Main measures
- Contribution rate raised from 9% by 0.5 point a year: 9.5% in 2026, 10% in 2027… 12.5% in 2032, 13% from 2033; employees and employers each pay half (4.75% each in 2026, 6.5% each at the end), self-employed and voluntary members pay all of it.[1][2]
- Nominal replacement rate set at 43% from 2026 (benefit-formula multiplier raised from 1.2 to 1.29), stopping the scheduled fall from 41.5% in 2025 to 40% in 2028; it applies to periods contributed from 2026, so pensions already in payment do not change.[1][12]
- Article 3-2 now states that the State must « guarantee » the stable and continuous payment of pension benefits, where it previously only had to adopt policies to that end.[1][2]
- Childbirth credit: 12 extra months of coverage from the first child (previously from the second), 18 months per child from the third, and the 50-month cap is abolished; military-service credit: actual service up to 12 months instead of a flat 6 months. The October 2026 amendment extends this, from 2027, to the whole service period and to 15 months for a second child.[1][8][3][14]
- Contribution support for low-income self-employed members no longer requires having resumed payments: from 2026, members earning under 800,000 won a month can have half their contributions paid by the State for up to 12 months — 736,000 eligible people against 193,000 in 2025, according to the ministry.[1][12]
In data
2025-2033, % of reference monthly income (employee + employer)
| Year | Before the reform | Act of 2025 |
|---|---|---|
| 2025 | 9% | 9% |
| 2026 | 9% | 9.5% |
| 2027 | 9% | 10% |
| 2028 | 9% | 10.5% |
| 2029 | 9% | 11% |
| 2030 | 9% | 11.5% |
| 2031 | 9% | 12% |
| 2032 | 9% | 12.5% |
| 2033 | 9% | 13% |
Scale starts at 0% · Legal rates written in the act (addendum art. 4 for 2026-2032, art. 88 from 2033). The rate had stood at 9% since 1998.
2025-2028, average earner insured for 40 years
| Year | Before the reform | Act of 2025 |
|---|---|---|
| 2025 | 41.5% | 41.5% |
| 2026 | 41% | 43% |
| 2027 | 40.5% | 43% |
| 2028 | 40% | 43% |
Scale starts at 0% · Before the reform the rate was to fall by 0.5 point a year to 40% in 2028 and stay there; the act fixes it at 43% from 2026.
Population by age band (share)
Value currently unavailable
Key figures
Timeline
Fifth actuarial projection: the fund would be exhausted in 2055[6]
Under the unchanged system, the reserve fund would peak in 2040 at 1,755 trillion won, the balance would turn negative in 2041 and the fund would be depleted in 2055 — two years earlier than in the fourth projection.
- Announced
Government reform plan: 13% contributions, 42% replacement rate[7]
Government reform plan adopted by the National Pension Deliberation Committee[7]
13% contributions, 42% replacement rate, fund returns raised by at least 1 point, contribution increases differentiated by generation (1 point a year for people in their fifties, 0.25 point for those in their twenties), review of an automatic adjustment mechanism and an explicit State guarantee. Two of the 16 members present disagreed.
Same-day committee approval and plenary vote; a special committee on pension reform is set up[4][11]
The Health and Welfare Committee adopted alternative bill no. 2209191 after a for-and-against debate, the Legislation and Judiciary Committee reviewed it the same day, then the plenary adopted it: 194 for, 40 against, 43 abstentions out of 277 members present (300 seats). The plenary also voted to create a special committee on pension reform, which held its first meeting on 8 April 2025.
- Current step
Structural reform before the Assembly’s special committee on pension reform[11][13]
Links between the national, basic, occupational and personal pensions and an automatic adjustment mechanism are left to this committee. On 24 June 2026 the government said these discussions were continuing.
National Assembly Budget Office analysis: fund depletion postponed from 2057 to 2065[15]
The NABO projects that the reform delays the first annual deficit by 7 years (to 2048) and fund depletion by 8 years (to 2065), against 2041 and 2057 without it; with fund returns one point higher, 2055 and 2073.
NABO revised projection: depletion in 2069 after the strong 2025 fund returns[16]
With a 2025 return of 18.82% and a fund of 1,458 trillion won at the end of 2025, the NABO moves the first deficit to 2050 and depletion to 2069 (2082 with returns one point higher). It notes that the government’s post-reform baseline gave 2064.
- Upcoming — the outcome is not known
Contribution rate reaches 13%, the end of the legal schedule[1]
The debate
Citoyen takes no position: arguments are reported as their authors put them.
According to its supporters
- The Ministry of Health and Welfare calls it the first reform in 18 years and the first rise in contributions in 27: with the fund-return target, depletion moves from 2056 to 2071 and the cumulative deficit to 2093 shrinks by 6,973 trillion won.[8][9]
- The Health and Welfare Committee argues that the average old-age pension, about 650,000 won a month in November 2024, falls short of a decent living: halting the cut to 40% and setting 43% strengthens income security.[4]
- According to the government, the explicit State guarantee answers the fear, strongest among young people, of never receiving a pension, and the credits compensate the career gaps caused by military service and childbirth.[7][12]
- The National Assembly Budget Office finds that an average earner insured for 40 years would receive at least 1.7 times their lifetime contributions in every generation, and that the reform cuts unfunded liabilities by 669 trillion won compared with the old rules.[15]
According to its opponents
- The National Assembly Budget Office stresses that the reform only postpones the problem: annual deficits from 2048 and depletion in 2065 (2050 and 2069 in its June 2026 update), with unfunded liabilities still estimated at 1,820 trillion won.[15][16]
- The government itself calls it « half a reform, an unfinished reform »: the first vice-minister of health warns that without follow-up reform there may be limits to fundamentally securing the system’s sustainability, and the finance ministry calls an automatic adjustment mechanism a core task of the structural reform.[10][11]
- On fairness between generations, the government’s own 2024 plan noted that young people pay more for less and proposed contribution increases four times slower for people in their twenties than in their fifties; the act applies the same 0.5 point a year to everyone. In the final vote, 40 members voted against and 43 abstained.[7][1][4]
- From the income-security side, the 43% rate falls short of the public deliberation of April 2024, where 56% of participants preferred 13% contributions with a 50% replacement rate (42.6% chose 12% and 40%) — a gap the ministry acknowledges.[9]
Indicators to watch
- Effective age of labour-market exit · OCDEno Citoyen card yet
- Social contributions, % of GDP · OCDEno Citoyen card yet
- Population by age band (share) · OCDESee the card →
- National Pension Fund: reserves, returns and projected depletion year · Ministère de la Santé et du Bien-être / NABOno Citoyen card yet
- Average monthly old-age pension · Service national des retraitesno Citoyen card yet
Sources
- [1]국민연금법 일부개정법률 (법률 제20903호, 2025. 4. 2. 공포, 2026. 1. 1. 시행) — 제정·개정이유 및 개정문 — 법제처 국가법령정보센터 (law.go.kr), April 2, 2025
- [2]국민연금법 [시행 2026. 10. 20.] [법률 제22096호] — 본문 및 부칙 — 법제처 국가법령정보센터 (law.go.kr), October 20, 2026
- [3]국민연금법 일부개정법률 (법률 제22096호, 2026. 10. 20. 공포) — 제정·개정이유 및 개정문 — 법제처 국가법령정보센터 (law.go.kr), October 20, 2026
- [4][2209191] 국민연금법 일부개정법률안(대안)(보건복지위원장) — 심사정보, 표결정보 — 국회 의안정보시스템 (likms.assembly.go.kr), March 20, 2025
- [5]표결정보 — 국민연금법 일부개정법률안 (제22대 국회) — 국회 의안정보시스템 (likms.assembly.go.kr)
- [6]제5차 국민연금 재정추계 결과 발표 — 보건복지부, March 31, 2023
- [7]정부, 상생의 연금개혁안으로 개혁 논의 본격 시동 (「연금개혁 추진계획」 확정) — 보건복지부, September 4, 2024
- [8]보험료율 13%, 소득대체율 43% 등 담은 연금개혁법안 국회 본회의 통과 — 보건복지부, March 20, 2025
- [9]연금개혁 관련 Q&A (보도참고자료 첨부, 2025. 3. 20.) — 보건복지부, March 20, 2025
- [10]보건복지부, 연금개혁 시행 추진단 제1차 회의 개최 — 보건복지부, April 7, 2025
- [11]국회 연금개혁 특별위원회 범부처 지원TF 1차 회의 개최 — 보건복지부, April 15, 2025
- [12]국민연금, 새해 재정은 보다 튼튼하게 노후는 더욱 든든하게 보장합니다 — 보건복지부, December 29, 2025
- [13]국민·기초·퇴직연금 등 국민 노후생활 보장 논의 위해 범부처 머리 맞대 (연금특위 범부처 지원 TF 2차 회의) — 보건복지부, June 24, 2026
- [14]군복무 기간 전체로 국민연금 크레딧 확대 등 국민연금법, 기초연금법 개정안 국회 본회의 통과 — 보건복지부, October 1, 2026
- [15]국회예산정책처, 「2025년 국민연금법 개정의 재정 및 정책효과 분석」 발간 — 국회예산정책처 (NABO), June 9, 2025
- [16]NABO Focus 제165호 — 기금운용실적 개선에 따른 국민연금 재정 수정전망 — 국회예산정책처 (NABO), June 18, 2026