Pension cut another legislative folly

By Lin Cho-shui 林濁水  / 

Wed, Jul 12, 2006 - Page 8

The passing of the amendment to the Statute Governing Preferential Treatment for Retired Presidents and Vice Presidents (卸任總統副總統禮遇條例), which greatly reduces the pensions for presidents and vice presidents, has given the Chinese Nationalist Party (KMT) a reason to be excited.

The amendment slashes presidential pensions to an amount well below the total annual NT$18 million (US$554,400) package that former president Lee Teng-hui (李登輝) receives. Specifically, the package would be only NT$11 million the first year after a president steps down (the amendment will go into effect next January) and NT$8 million per year after three years.

Under the new rules, preferential treatment would be extended for the same number of years as the person's term in office. In other words, President Chen Shui-bian (陳水扁) would be entitled to eight years of preferential treatment after 2008. Lee, however, is entitled to 12 more years of preferential treatment, on top of the seven years that he has already received to reflect the 19 years he spent first as vice president and then president.

Of course, the KMT is delighted by the amendment's passing because it deals a heavy blow to Chen. In fact, the amendment hit two birds with one stone -- not only did it slash Chen's benefits, but it preserved former vice president Lien Chan's (連戰) current pension.

Lien, therefore, can go on collecting benefits befitting of a retired US president but not a retired US vice president, including monthly payouts in excess of NT$460,000. The president, meanwhile, is eligible for only NT$250,000 per month upon retirement.

Lien's family members recently swore that they would no longer receive any excessive preferential treatment, but now they do not have to deliver on that promise.

The amendment, when put into effect, translates into doting on Lien, sheltering Lee and bulldozing Chen. This result is the product of pure politicking.

The amendment is poles apart from the US' approach to providing retired presidents with preferential treatment, due to the nasty partisan politics behind it. The US' presidential retirement package is derived from an era in which presidents were expected to show self-restraint and be upstanding.

Many retired presidents had to become lawyers or judges after their terms in order to avoid destitution -- an embarrassing phenomenon for the nation.

For example, presiding over cases litigated by an attorney who was once the country's president was a sticky situation for judges. Former presidents becoming chairmen of companies also proved to be problematic.

So, the US established a system that allowed former presidents to live out their remaining years in relative comfort and safety. To that end, the content of such preferential treatment is more or less as follows:

First, to guarantee a former US president a life free of worries upon retirement, a lifelong monthly pension is provided.

Second, to safeguard a former president's dignity and reputation, an office and staff are also provided, with related transportation and other costs borne by the government.

Third, to guarantee a former president's safety and security, the government also provides him or her with the necessary protection.

Fourth, the scale of the above preferential treatments is not to exceed what is reasonably required. For example, the former president's monthly pension is not significantly more than an acting Cabinet secretary's salary; he or she can only employ one staffer for his or her office and protection is not provided beyond 10 years after he or she leaves the White House.

Excluding compensation items that are not publicized due to national security interests, former US presidents collect an average compensation -- monthly pension and an office stipend -- of NT$10 million per year.

Taiwan's system, in comparison, has a number of troubling characteristics:

For one, the scale of compensation is overblown. Although compensation offered to retired Taiwanese leaders from now on will range from NT$8 million to NT$11 million, which is on a par with US standards, Taiwan's GDP per capita is much lower than that of the US. The amount of compensation is the result of the pan-blue camp's unwillingness to accept the notion of a drastic cut in Lee's bloated pension.

Second, the pensions expire too quickly, and this is something that I pointed out in consultations. For future "clean" presidents, a retirement pension that expires too quickly will be an embarrassment for the country. I also emphasized that an even less generous expiration date, or even a cancelation of pensions altogether, would not affect Chen and Lee so much, given that they're already extremely wealthy.

But what about future "clean" presidents whose bank accounts are not so fat? Unfortunately, in a political environment rife with anti-Chen sentiment, this point fell on deaf ears.

Third, giving retired presidents inflated pensions could translate into encouraging relatively young, energetic former presidents to use their power and connections to continue politicking, and this would further destabilize the political


Finally, protection does not equal extravagance; it is a national security issue. Publicizing the number of security personnel assigned to a former president goes directly against the US practice of keeping such information classified and flexibly adjustable depending on temporary needs.

Current social conditions lend themselves to significantly revising the presidential and vice presidential preferential treatment systems. Unfortunately, such revision efforts have been politically hijacked to quench the thirst for revenge against Chen and to curry favor with the public.

Many of the amendment's regulations do not meet US standards, nor do they meet the long-term needs of Taiwan. By protecting the interests of a couple former leaders now and ensuring the punishment of good presidents in the future, this amendment will go down in history as yet another typical legislative folly.

Lin Cho-shui is a Democratic Progressive Party legislator.

Translated by Max Hirsch