Military pension reform

  • Date: 2018-06-21

I.  Background
The topic of pension reform has taken center stage across Taiwan as the nation’s rapidly aging population and falling birth rate place enormous financial strains on the pension system for military personnel, civil servants and teachers. In consideration of the special nature of military service, the government is addressing pension reform for military personnel separately from other public-sector employees.

Following the Legislature’s passage of amendments to laws governing retirement and pensions for civil servants, teachers and political appointees, the Ministry of National Defense and the Veterans Affairs Council jointly drafted amendments to the Act of Military Service for Officers and Noncommissioned Officers of the Armed Forces. These revisions received the Legislature's approval on June 20, 2018 and came into force July 1 the same year.


II. Features of the new military pension system
 The reformed military pension system is modeled after military retirement programs in the U.S., Japan and Korea.
 The maximum service period for offers at all levels will be extended appropriately to encourage soldiers and officers to commit to long-term careers in the military.
 In addition to raising the salary contribution rate to match that paid by civil servants and teachers, the government will increase funding for the military pension system, and place all resulting funds into the military pension fund.
 To protect the rights of those close to or already in retirement under the old pension system, a number of moderate adjustments will be made over the transition period to close the gap between the new and old systems gradually.
 Eligibility for retirement remains unchanged at 20 years of service, and pension payments will be prioritized by the government.

III. Benefits of the new system
 Helps promote the military recruitment system.
 Encourages active military personnel to serve long-term.
 Rewards longer service periods with higher pension payout rates.
 Provides financial support for military personnel in retirement.
 Places dedicated funding into the military pension fund to ensure sustainable operation into the future.