Regarding monthly pension levels, Mr. Phạm Trường Giang, Head of the Social Insurance Department at the Ministry of Labor, Invalids, and Social Affairs, stated that international standards compare pensions to average national income.
Currently, Vietnam’s average pension is approximately $260 per month, while the average GDP per capita is around $4,700.
Mr. Giang provided an example from South Korea, where the average old-age pension is about $570 per month, equivalent to $6,840 annually. The country’s GDP per capita is approximately $36,000, equivalent to $864,000.
According to the Head of the Social Insurance Department, Vietnam’s pension is not low by international standards. However, a portion of workers who retired before 1995 receive lower pensions due to shorter working periods and early retirement.
In 1995, the pension rate in South Korea was 50%, corresponding to 40 years of contributions. Due to balancing pressures, this rate has been reduced by 0.5% annually, with projections suggesting it will reach 40% by 2028. To address the low rate, the government aims to maintain the pension rate at 42%.
Mr. Giang mentioned that as of 2023, South Korea’s national pension fund stands at 1.775 trillion won, equivalent to over $7 billion—ranking third globally. However, this fund is expected to go into deficit from 2041 and deplete by 2055. Consequently, the South Korean government plans to increase corporate social insurance contributions.
Due to pension fund pressures, South Korea intends to gradually raise contribution rates from 9% to 13%, while maintaining the pension payout rate at 42%, equivalent to 40 years of contributions.
“With population aging, the number of contributors will decrease, while the number of beneficiaries increases, putting more pressure on the fund,” Mr. Giang noted.
The Head of the Social Insurance Department also highlighted that Vietnam is one of the fastest-aging countries globally. By 2025, for every six people in the labor force (ages 15-59), there will be one person outside the labor force. By 2055, two people in the labor force will need to support one person outside the labor force.
“To maintain current benefit levels by 2055, we have two options: either future generations must contribute three times the current amount to social insurance, or reform the system to ensure these groups receive appropriate benefits, reducing the burden on future generations,” he added.
According to statistics from the Vietnam Social Security, nearly 3.4 million people currently receive monthly pension and social insurance benefits.
From 1995 to the present, the National Assembly and Government have adjusted pensions 24 times. After multiple adjustments, current pension levels are now 21 to 26 times higher than those in 1995.
The most recent adjustment took place on July 1, 2024, following Decree 75/2024/ND-CP, which increased pensions by 15%. For retirees from before 1995, if their pension after the 15% increase was still below $150 per month, they received an additional adjustment.
Specifically, those receiving less than $120 per month saw their pensions increased by $9.50 per month, while those receiving between $120 and $150 per month were raised to $150.
Source link: https://dantri.com.vn/an-sinh/luong-huu-binh-quan-62-trieu-dongthang-la-cao-hay-thap-20250208093943456.htm
