Tue, Dec 28, 1999 page17

• Retirement plan may be revisited

  PENSIONS A plan to implement a national retirement scheme, put off after the 921 quake, may get a second chance if the government decides it can afford it

  • By Shirley Sun / STAFF REPORTER
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  A national annuity plan (國民年金) may be implemented as early as the end of next year, according to the chairman of the government's economic planning council.

  This is the time the plan was originally due to be implemented.

  In September, however, it was temporarily suspended following the 921 earthquake.

  However, according to Chiang Pin-kung (江丙坤), chairman of the Council for Economic Planning and Development (經建會), once the costs of quake reconstruction are clear, implementation of the annuity plan can be re-evaluated.

  "It is not appropriate to implement the annuity plan before the effects of the reconstruction plan have become apparent, or before the government's financial status has been made clear," Chiang said.

  The chairman made the announcement at a press conference in which the council presented its white paper on national economic policy, entitled the "Cross the Century National Development Plan" (跨世紀國家建設計畫).

  In an earlier report, the council estimated the government's deficit for the current fiscal year [which ends at the end of next year] would increase by NT$116.9 billion to NT$507.1 billion. The figure represented a 5 percent increase over the estimated deficit before the quake. The accumulated government debt would amount to NT$2.39 trillion, or 24.1 percent of this year's GNP, according to the report.

  However, while the government works out exactly how much reconstruction will cost, postponing the re-evaluation of the national annuity plan to a year from now "does not mean its implementation will be delayed for a year," Chiang said.

  "Once an accurate estimate of the cost of the reconstruction effort can be made, and the financial sources are confirmed, then we can start the plan," he said.

  Once implemented, the annuity plan will provide every citizen over 64 with a monthly pension of NT$8,700. The plan will be paid for by taxing the salary of every working citizen between the age 25 and 64. Any shortfall would be covered by the government.

  According to estimates by the council, the government will have to pay in NT$23 billion to NT$30 billion during the first year of the plan.

  As for financial sources to pay for the plan, increasingly promising economic prospects next year in Taiwan may help boost tax revenues.

  Outside Taiwan, "the international community will be experiencing strong economic growth [which supports Taiwan's export-oriented economy]," Chiang said. "We are especially proud that the trade relationship with Japan has improved significantly."

  Exports to Japan increased by 26.2 percent this year, Chiang said.

  "With China's better economic performance, our trade with Hong Kong has also increased," Chiang said. "Exports drive up our economic performance."

  Chiang also estimated that an economic growth rate of 6.1 percent should also be achieved next year. "The reconstruction effort has gone smoothly, and it will begin to boost the economy next year," he said.

  "It should be possible to complete the preliminary work for the reconstruction by the end of this year," Chiang said.

  Of a total of 42 projects, the sixteen that remain unfinished are expected to be carried out by the end of this week.

  "The development plan for the Sun Moon Lake (日月潭國家風景區) has been finished. Once it receives approval by the Executive Yuan, it will start its overall renewal project," Chiang said.

  And with booming world economies and a successful recovery from the earthquake, Chiang sounded a positive note.

  "Besides aiming to become a green technology-oriented island by 2011, with a stable consumer price index and annual economic growth of 6 percent, we also have a four-year plan ending in 2004," he said. "By then, we aim to have the country's average personal annual income at a level of NT$600,000."

  That would be equal to the annual personal income level of the UK in 1996.
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