The following remarks were delivered by Premier Sean Chen today at a press conference at the Office of the President:
Since the mid-1980s, countries around the world have embarked on different kinds of reforms of their pension fund systems. Some took austerity measures like pushing back the retirement age or reducing payouts, while others overhauled their entire system by moving toward a defined contribution scheme. All of these changes were made with the aim of improving the fiscal health of their pension systems and extending stronger protection to citizens.
In Taiwan, the pension system has deviated from the norm as separate systems have emerged over the past two decades to serve different professions, with some of the regulations in one system being used in another. An aging population has also exacerbated financial pressures and raised concern from the public. Although Taiwan initiated its reforms later than other countries, it will do so with equal vigor and diligence.
To address the long-standing challenges, in June 2008, the Executive Yuan directed the Council for Economic Planning and Development (CEPD) to formulate policies for stronger economic security for senior citizens. In November 2009, the CEPD established a pension reform task force, which conducted research and convened six meetings from 2010 to 2012. This year on October 9, public anxiety was triggered by a news report of the possibility of the Labor Insurance Fund facing bankruptcy earlier than expected. Three days later I pledged that the Cabinet would come up with a plan by January 2013 to reform labor insurance and other annuity systems. I also promoted the CEPD's task force to the Cabinet level and designated Vice Premier Jiang Yi-huah to serve as its convener.
This time, our principles for reform are quite simple—to come up with a system that is fiscally sound, socially fair, pragmatic and stable, and inclusive of all generations. New problems should not be created when solving existing ones.
Recently I have been concerned about the negative tones pervading the reform discussions in Taiwan. We want people to engage in rational, sensible and objective conversations, not heated exchanges fueled by bias or enmity. Most of all, we do not want to see clashes among different generations, professions or groups. Conflicts of this nature divide family and friends and tear at the very fabric of our society. Thus I have discussed at length with my colleagues and with President Ma Ying-jeou our intention to expand public participation in the reform process. Our focus should be on resolving the issues at hand and forging a consensus among people of differing opinions.
Accordingly, the Cabinet's pension reform task force has outlined a two-phase plan. We will hold weekly meetings on designated topics, and invite experts, scholars and representatives of relevant organizations to discussion forums. We will also solicit opinions from different caucuses of the Legislative Yuan while working with the Examination Yuan to hold public hearings on matters of prime concern. After gathering input from all sectors, we will garner support from the Legislative Yuan to begin the process of amending laws.
It is our hope that the reforms will not only create a sustainable pension system, but also allow Taiwan to mature through the process of forging a society-wide consensus.