Civil servants are different, especially when it comes to social security

March 2nd, 2012 by Philip Brasor & Masako Tsubuku

A major feature of the Democratic Party of Japan’s manifesto that helped make it the ruling party was its proposed overhaul of the social security system. One feature of the plan was to combine two types of pensions. Regular full-time employees usually pay into the kosei nenkin system if they work for a private company, or into the kyosai nenkin system if they work for a public entity. This latter group includes civil servants, whether they work for the central government or a local one, and school teachers, including instructors at private schools.

You're the only one who cares about your pension

However, there is a real difference in terms of both premiums and benefits between the two systems. Though in both cases, the employee splits his contributions with his employer, the rate is less for kyosai nenkin members than it is for kosei nenkin members. Even more significant, kyosai nenkin members after retirement receive ¥20,000-a-month more in benefits than do kosei nenkin members. And that’s not all. While the widows of both kosei nenkin and kyosai nenkin members can receive a special pension when they survive those members, under certain conditions other surviving family members of deceased kyosai nenkin members can also receive benefits. That does not apply to kosei nenkin members and their families.

The problem with the proposal to combine these two systems is that public servants will lose these special privileges. The kyosai nenkin system will adhere to the regulations associated with the kosei nenkin system, which is is why it hasn’t been discussed much during the current Diet session. The bureaucracy, needless to say, isn’t very fond of the proposal and is fighting it.

Another social security proposal from the manifesto that seems to have died on the vine is bringing more non-regular employees into the kosei nenkin system. At present, anyone who joins has to work at least 30 hours a week. Otherwise they have to pay into the kokumin nenkin, or regular pension, system. Forces in the DPJ were supposed to submit a bill during this session that would change the rules for kosei nenkin members to allow anyone who works more than 20 hours a week and has been in his or her position for at least six months to join. In this new system, a 45-year-old woman who makes ¥100,000 a month must pay a set premium of ¥15,000 a month into the basic pension system, but if she meets the conditions of the new system, she would join the kosei nenkin system and split the premium with her employer, which means she’d pay only ¥8,000 a month. At retirement, that amount would give her ¥500 a month more in benefits than the basic pension benefit for each year of payment. So if she paid into the system for 20 years, she’d get ¥10,000 more a month.

The main difference would be for “type 3″ members, meaning wives of kosei nenkin members. At present, type 3 members don’t have to pay anything, but under this proposed revision the housewife would have to pay ¥8,000 a month, just as the employed woman would; that is, if she decided to join.

It goes without saying that the main obstacle to implementing this plan is employers, who don’t want the extra burden of having to pay their part of kosei nenkin premiums. In any case, the government’s idea of a totally integrated social security overhaul that would result in a guaranteed minimum pension has been roundly criticized, so it seems even less likely that these two proposals, which wouldn’t really cost anything, have much of a chance. At present, the only thing the administration cares about is pushing an increase of the consumption tax.

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2 Responses

  1. I don’t know much about the system, but I do know two women who made a point of marrying civil servants precisely because they were assured of a stable income and a guaranteed pension. With these new changes in the pipeworks, the women are fuming and talking about divorce. It goes without saying that they have always detested their husbands, and only married for the security.

    Women are scary!

  2. Though cuvil cervants (or could I also say public officers’) pension has become a much-talked-about topic recently, there is almost no talk about the endless working hours and the excess amount of overtime work these people do.
    I am really tired of hearing and reading about how unfair it is.
    Yes, it does look unfair if you do not look under the surface.
    As in private companies, after being promoted to certain positions, civil cervants lose the right of receiving the overtime work payment.
    The difference, however, is in the number of overtime work hours.
    There are many who score nearly 200 hours of overwork per month, every month, regardless of the fact that they do not get paid.
    I wonder how many of the people complaining about the kyousei pension system work that hard throughout the year.
    I do believe that there are only few employees in private companies who would do that (except for company owners, of course). And I accept the fact that part of my tax money is used for kyousei nenkin which is remuneration for the endless, excessive overtime work of those people.
    Also, the media usually fail to point out the difference between the ministry workers and the local civil cervants – try and check how much different they are in terms of amount of work and its weight.
    I am a foreigner who lives in Japan and pays tax here, but I am fed up with the populist policy of the current governemnt trying to avoid criticism towards itself by setting the public officers, including those in the ministries, in the spotlight. Unfortunatley this policy has been supported quite light-heartedly by the media in this country.
    Get real and try to look deeper than just the surface!
    And try not to be manipulated so easily by the people in power.

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