South Korea basic pension spending to exceed 30 trillion won by 2030

South Korea's mandatory welfare spending is projected to rise significantly, with basic pension expenditures expected to exceed 30 trillion won by 2030. According to the ‘2026–2030 National Fiscal Management Plan’ submitted to the National Assembly, basic pension spending is forecast to grow at an average annual rate of 6.8%, up from the 6.7% growth rate projected last year.

This increase is driven by an aging population, rising inflation, and changes to the pension distribution system. The government is pursuing a ‘more for the poor, less for the wealthy’ reform. Under the proposed budget, the bottom 30% of elderly earners will receive 380,000 won—an increase of 30,000 won. Additionally, the 20% reduction rate for married couples in the bottom 45% of income earners will be lowered to 10%.

Other mandatory expenditures are also climbing. National Basic Livelihood Security benefits are projected to grow by an average of 13.9% annually, reaching approximately 37.8 trillion won by 2030. Health insurance and long-term care insurance expenditures are also expected to rise. Consequently, total mandatory spending is forecasted to reach 537.8 trillion won by 2030, representing an average annual increase of 8.5%, up from the 6.3% previously estimated.