Women’s Pension Rights in the Korean National Pension and the J apanese Public Pension

Purpose: In Korea and Japan, the birthrate is declining and the population is aging at an unprecedented rate compared to other countries. In particular, the average life expectancy of women is longer than that of men, so the public pension systems that financially support women’s lives in old age is more important than ever before. Korea and Japan have many similarities in women’s lifestyles and employment structures, and labor laws related to women, but there are many differences in the structure of women’s pension rights. Research design, data, and methodology: This paper focuses on women’s pension rights in Korean National Pension and Japanese public pension and examines the following three points: First, the history and structure of the public pension in Korea and Japan. Second, women’s pension enrollment conditions and the current situation in the Old-Age Pension, which accounts for 80% of public pension benefits. Third, the structure of the Survivors’ Pension and the divorce-based Pension Splitting, which 90% of beneficiaries are women. Results: Public pension system in Korea consists of two parts with the National Pension(NP) and a Special Occupational Pension(SOP). On the other hand, public pension system in Japan consists of a two-tier structure with the National Pension(NP) and the Employees’ Pension Insurance(EPI). The main difference between the two countries in relation to women’s pension rights is the treatment of dependent spouses. In Korea, pension contributions are based on “individual units”, and dependent spouses are classified as Voluntary Insured Persons of NP. On the other hand, in Japan, dependent spouses of a Category Ⅱ Insured Persons are classified as CategoryⅢ Insured Persons and they receive the Old-Age Basic Pension of NP in old age without paying the pension contribution. In addition, women’s pension rights in Survivors’ Pension and divorce-based Pension Splitting also depend on the Category of NP, which their spouse have covered. Implications: In Korea, more than 50% of married women are full-time housewives, and most of them are not covered by the Old-Age Basic Pension of NP. As a result, one in two elderly women is in poverty without pension in old age. In Japan, more than 90% of married women are covered by pensions, but there is an unfairness in insurance contribution and benefits between self-employed households and employee households. Although there are institutional differences in women’s pension rights between the two countries, women can receive more benefit amount in old age when they work and are covered by their own pension. In order for more women to be able to continue working without interruption of their careers, to increase the participation rate of women in public pensions, and to reduce the poverty rate of women in old age, the governments of both countries have to take stronger measures to encourage women’s employment and support the balance between work and family.