The Executive Yuan yesterday approved two draft amendments to reduce pension benefits for political appointees and public employees, with the drafts outlining larger pension cuts than the Examination Yuan’s versions.
The Executive Yuan approved a draft amendment to the Act Governing the Recompense for the Discharge of Special Political Appointees (政務人員退職撫卹條例) and a draft amendment to the Civil Servant and Teacher Insurance Act (公教人員保險法), which differed from the amendments proposed by the Examination Yuan, although they all seek to phase out an 18 percent preferential savings rate for retired public employees, lower the income replacement rate, extend the retirement age and increase pension premium rates.
In terms of retirement benefits for political appointees, the Executive Yuan’s amendment would lower the income replacement ratio by 15 percentage points over 15 years. The replacement ratio of ministerial-level appointees would be lowered from 65 percent to 50 percent and the replacement ratio of other appointees would be lowered from 75 percent to 60 percent.
The Examination Yuan’s proposals seek smaller cuts, with the replacement ratio of ministerial-level appointees to be lowered from 65 percent to 55 percent over 10 years and that of other appointees to be lowered from 80 percent to 70 percent.
In terms of phasing out the 18 percent preferential savings rate, the Executive Yuan’s version would exempt appointees who receive a monthly pension of less than NT$32,160, while the Examination Yuan’s proposal would allow ministerial appointees to retain the preferential rate should their income replacement rate drop to less than 55 percent over the course of pension reform and other appointees would retain the 18 percent saving rate should their income replacement rate drop to less than 70 percent.
In terms of qualification for survivor benefits, the Executive Yuan’s proposal stipulates that underage children or the spouse of a deceased political appointee can receive half the monthly pension paid to the appointee, but the spouse must be aged 65 or older and had been married to the appointee for at least 15 years.
The Examination Yuan’s version has similar requirements for survivor benefits, except that spouses would be entitled to the benefits if they are aged 55 or older and had been married for at least 10 years.
In terms of civil servants’ and teachers’ pensions, the Executive Yuan’s proposal differs from the Examination Yuan’s only in the category of survivor benefits.
The Examination Yuan’s amendment would entitle the widows or widowers of deceased civil servants or teachers to survivor benefits if they are aged 55 or older and had been married for at least two years, while the Executive Yuan’s version sets the age limit at 65 with a marriage duration of at least 15 years.
The draft amendments prepared by the Executive Yuan and the Examination Yuan are to be jointly reviewed by the legislature.
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