Reforming the pension system certainly has not been easy for the Democratic Progressive Party (DPP), yet it is something that must be done. Unlike the Chinese Nationalist Party (KMT), which relies on attracting voters with promises of benefits, the DPP started out as a party of reform, and most voters who back reform support the DPP. For this reason, President Tsai Ing-wen’s (蔡英文) administration must push for reform or risk losing supporters.
It is perfectly normal for people with vested interests to defend those interests. Some of them have turned to support the DPP out of dislike for the KMT, but the DPP’s effort to promote pension reform is now causing tension between the party and such voters. Obviously, in pushing for reforms, the DPP stands to lose support and is unlikely to gain popularity among this group. Therefore, the key issue should be how to minimize the loss of support rather than how to gain support. As the KMT is falling apart, now is an ideal time for carrying out reforms.
Many people considered former president Chen Shui-bian (陳水扁) an excellent mayor of Taipei. His strategy was to use mainstream public opinion as leverage against conservatives who resisted reforms.
For example, he transformed the Taipei City Government by changing the attitudes of public servants: Before his tenure, officials at Taipei City Hall often had a condescending attitude, but now they have changed and see themselves as serving city residents. Although Chen did lose support among public servants, he gained recognition from the majority of Taipei residents. This shows that, as long as one has the support of the public, it is alright to make a few people unhappy.
It is human nature to defend one’s vested interests. Lowering the income replacement ratio should be the last solution for balancing pension funds as it would offend military personnel, public servants and public-school teachers.
Before retirement, each person has different duties and responsibilities, so it makes sense that everyone receives a different pension. However, after retirement, each person’s contribution is the same. A person’s pension therefore should not be based on their past salaries. The traditional pension scheme for political appointees is particularly unfair: After two years in office as a political appointee, an official is eligible for a pension plan that takes into account not only their experience as an appointee but also any previous experience in the military or in the public sector.
The best way to reform the pension system is to set a ceiling for pensions. The ceiling should be set based on the performance of the pension fund. While a small number of high-ranking officers in the military and public sector might be unhappy with such a change, most would welcome it with open arms. This way, the DPP could minimize the loss of support that reform will necessarily entail.
The national pension system is mostly funded by the government. In the same way as the National Health Insurance (NHI) program, it is a social benefit rather than a commercial insurance. With commercial insurance schemes, the more one pays, the more benefits one gets. However, with social benefits, the more one makes, the more one pays, yet the benefits remain the same for everyone.
This is why, in the NHI system, although premiums vary from person to person, everyone receives the same medical benefits. From the standpoint of a social benefit, it is only fair to set a ceiling on pensions to ensure the system’s sustainability.
Chen Mao-hsiung is a retired National Sun Yat-sen University professor and chairman of the Society for the Promotion of Taiwanese Security.
Translated by Tu Yu-an
From the Iran war and nuclear weapons to tariffs and artificial intelligence, the agenda for this week’s Beijing summit between US President Donald Trump and Chinese President Xi Jinping (習近平) is packed. Xi would almost certainly bring up Taiwan, if only to demonstrate his inflexibility on the matter. However, no one needs to meet with Xi face-to-face to understand his stance. A visit to the National Museum of China in Beijing — in particular, the “Road to Rejuvenation” exhibition, which chronicles the rise and rule of the Chinese Communist Party — might be even more revealing. Xi took the members
Taiwan’s higher education system is facing an existential crisis. As the demographic drop-off continues to empty classrooms, universities across the island are locked in a desperate battle for survival, international student recruitment and crucial Ministry of Education funding. To win this battle, institutions have turned to what seems like an objective measure of quality: global university rankings. Unfortunately, this chase is a costly illusion, and taxpayers are footing the bill. In the past few years, the goalposts have shifted from pure research output to “sustainability” and “societal impact,” largely driven by commercial metrics such as the UK-based Times Higher Education (THE) Impact
History might remember 2026, not 2022, as the year artificial intelligence (AI) truly changed everything. ChatGPT’s launch was a product moment. What is happening now is an anthropological moment: AI is no longer merely answering questions. It is now taking initiative and learning from others to get things done, behaving less like software and more like a colleague. The economic consequence is the rise of the one-person company — a structure anticipated in the 2024 book The Choices Amid Great Changes, which I coauthored. The real target of AI is not labor. It is hierarchy. When AI sharply reduces the cost
The inter-Korean relationship, long defined by national division, offers the clearest mirror within East Asia for cross-strait relations. Yet even there, reunification language is breaking down. The South Korean government disclosed on Wednesday last week that North Korea’s constitutional revision in March had deleted references to reunification and added a territorial clause defining its border with South Korea. South Korea is also seriously debating whether national reunification with North Korea is still necessary. On April 27, South Korean President Lee Jae-myung marked the eighth anniversary of the Panmunjom Declaration, the 2018 inter-Korean agreement in which the two Koreas pledged to
RSS