National Pension Fund could be used to create 300,000 public health care jobs

Posted on : 2017-06-07 17:21 KST Modified on : 2019-10-19 20:29 KST
Finance Minister nominee will have to state position on plan to fulfill one of Pres. Moon’s campaign pledges
A debate on public social service providers
A debate on public social service providers

Discussion has begun on a plan to create 300,000 public sector jobs by using money from the National Pension Fund to set up public social service providers under the control of South Korea’s 17 regional local governments (cities and provinces), which would directly provide social services such as public health care and nursing for the elderly. One way to accomplish this that is under consideration is to invest about 2 trillion won (US$1.78 billion) of the 540 trillion won (US$482 billion) in the pension fund to set up public social service providers.

“We’re moving forward a little faster in our discussion of establishing public social service providers, which was one of [President Moon Jae-in’s] campaign pledges. When we release our report on the five-year governance plan at the end of this month, we’re planning to include a plan that will be more fleshed out than what we pledged during the campaign,” said a key member of the governance planning advisory committee on June 6. The advisory committee is functioning as a sort of transitional committee for the Moon administration.

The advisory committee discussed the plans to set up public social service providers and to expand public investment by the National Pension Fund on June 3 and 5, respectively. The meetings were attended by advisors and experts on the society subcommittee of the advisory committee (chaired by Kim Yeon-myeong, a professor at Chung-Ang University) and officials from the Ministry of Health and Welfare. Also present at the meetings were Kim Yong-ha, a professor at Soonchunhyang University and an expert on pensions, and figures from the campaign of Moon Jae-in who helped craft his pledges.

Establishing public social service providers and expanding public investment by the National Pension Fund are two of Moon’s campaign pledges that are closely linked. Public social service providers would be public enterprises established under each regional local government with the goal of taking over about 40% of social services in areas such as public health, childcare and nursing for the elderly that are currently outsourced to the private sector. That’s how Moon means to create 300,000 of the 810,000 public sector jobs he has promised to create. The pledge to expand public investment by the pension fund refers to a plan to use money from the pension fund to create jobs in the public sector and to expand public housing. The advisory committee is considering the idea of investing about 2 trillion won of the total 540 trillion won at the fund’s disposal to establish public social service providers. The Ministry of Health and Welfare submitted a report to the advisory committee in which it proposed that the National Pension Fund buy special-purpose bonds issued by the government. Part of the government funding raised in this manner could then be used to establish and operate public social service providers, the Ministry said.

But the plan to use the National Pension Fund to create public sector jobs will need to be reviewed by the Ministry of Strategy and Finance, which is in charge of the government budget, before it can be finalized. “Discussion of this issue will proceed after Kim Dong-yeon, the nominee for Finance Minister, expresses his position on the plan during the hearing at the National Assembly on June 7,” said a member of the advisory committee.

By Kim Kyung-rok, staff reporter

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