January 23, 2011
Finance Minister Yosano Kaoru on January 21 hinted at the possibility of raising the eligible age for the start of pension benefits from the present age of 65.
The Kan government is stressing the need to continue providing stable welfare services in order to have the general public accept an increase in the consumption tax rate. However, Yosano’s latest remark has shown that the government intends to cut the social welfare programs sometime in the future.
Currently, at the age of 65, people start receiving national pension benefits. As for the employees’ pension program, the eligible age to start receiving benefits varies from 60 to 65 years old.
The pension benefits are important sources of income to support people after retirement. It will be contradictory for the government to claim to seek a more stable social welfare environment while providing less benefits to them.
Japanese workers normally retire at the sage of 60. Retirees have always had difficulties in re-entering the labor market. Even now, they are greatly concerned about what they should live on after retirement until they reach 65 years of age. An increase in the applicable age will only provoke anxiety among the general public and further weaken domestic demand as it will discourage them from spending money.
The government hardly has enough resources to provide enough pension benefits because it has long allowed large corporations to cut back on the number of full-time regular workers, though they make up the majority of pension premium payers, and allowed them to hire more young workers on temporary contracts. Accordingly, the government is suffering from a decrease in pension premium revenues.
The need now is for the government to establish regulations to oblige corporations to employ workers on regular contracts and to secure funds for the pension programs by levying an appropriate share of the costs of social security on large corporations and large asset holders.
The Kan government is stressing the need to continue providing stable welfare services in order to have the general public accept an increase in the consumption tax rate. However, Yosano’s latest remark has shown that the government intends to cut the social welfare programs sometime in the future.
Currently, at the age of 65, people start receiving national pension benefits. As for the employees’ pension program, the eligible age to start receiving benefits varies from 60 to 65 years old.
The pension benefits are important sources of income to support people after retirement. It will be contradictory for the government to claim to seek a more stable social welfare environment while providing less benefits to them.
Japanese workers normally retire at the sage of 60. Retirees have always had difficulties in re-entering the labor market. Even now, they are greatly concerned about what they should live on after retirement until they reach 65 years of age. An increase in the applicable age will only provoke anxiety among the general public and further weaken domestic demand as it will discourage them from spending money.
The government hardly has enough resources to provide enough pension benefits because it has long allowed large corporations to cut back on the number of full-time regular workers, though they make up the majority of pension premium payers, and allowed them to hire more young workers on temporary contracts. Accordingly, the government is suffering from a decrease in pension premium revenues.
The need now is for the government to establish regulations to oblige corporations to employ workers on regular contracts and to secure funds for the pension programs by levying an appropriate share of the costs of social security on large corporations and large asset holders.
