Tapgol Park, located in central Seoul, is a popular destination for local seniors. (Yonhap)
SEOUL, March 9 (Korea Bizwire) — South Korea’s elderly poverty rate, which was once the highest among Organization for Economic Cooperation and Development (OECD) member countries, has slipped to the 30 percent level for the first time.
According to Statistics Korea, the nation’s elderly poverty rate for those aged 65 or older on the basis of disposable income level stood at 38.9 percent in 2020, down 2.5 percentage points from a year ago.
The primary factor behind the decline in the nation’s elderly poverty rate is the basic pension system that was introduced in 2014.
This system is a kind of old-age income guarantee system that provides a certain amount of basic pension benefits on a monthly basis to those aged 65 or older who belong to the bottom 70 percent income bracket.
The Ministry of Health and Welfare analyzed data from Statistics Korea to reassess the effect of the basic pension system.
The analysis showed that if the basic pension benefit is included in the earned income of the elderly, the absolute elderly poverty rate falls from 38.6 percent to 28.8 percent, and the relative poverty rate slips from 50.3 percent to 44.7 percent.
The monthly basic pension benefit increased to 307,500 won (US$249) this year, up 7,500 won from a year ago, reflecting the 2.5 percent growth in consumer prices last year.
J. S. Shin (js_shin@koreabizwire.com)
