Korea's president apologises, urges support for curtailed pension pledge

Korea's president apologises, urges support for curtailed pension pledge

SOUTH KOREA - President Park Geun-hye on Thursday apologised for cropping out richer seniors from her new basic pension plan, but insisted she still stood by her pledges that had to be partially curtailed due to fiscal woes.

Her remarks at a Cabinet meeting came as the government announced its 2014 budget plan, met by angry reactions from her political rivals. The main opposition Democratic Party pledged a "budget war" against what they call a "deceptive retreat of pledges by Park."

The budget bill is to be submitted to the National Assembly for approval. The ruling Saenuri Party, although at a majority, needs the opposition's cooperation as a revised Assembly act prohibits the bulldozing of bills such as by allowing a filibuster.

"I express apologies that we are not able to give (the basic pension) to all the senior citizens," Park said while presiding the meeting.

Park has been facing growing criticism for failing to channel her presidential pledges through sound finances, leading to significant slashes in her welfare pledges despite her earlier assurance to maintain them.

Park said it was inevitable to scale back the basic pension plan, which would provide between 100,000 won (S$117) and 200,000 won in basic pension benefits to the poorest 70 per cent of seniors 65 years of age and older based on wealth and income. She had originally promised to benefit all seniors in the age group.

The take-home amount of the basic pension is also expected to be inversely proportional to the length of subscription to the national pension for the sake of benefiting those left out of the national pension system. According to this revised plan, 90 per cent of those subject to receiving the basic pension benefits are expected to receive the full 200,000 won.

"It was unavoidable realistically as we have to tighten the grip on fiscal sustainability amid an unprecedented tax revenue shortage entwined with global economic slump," she said.

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