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Opinion

A pension service beset by woes

July 21,2018
JEONG JONG-HOON
The author is a welfare news reporter at the JoongAng Ilbo.

“Many of my friends who have worked here for a long time have left. I feel sorry for those who remain,” confessed an employee who quit his job at the National Pension Service (NPS). Five former managers I interviewed said that they were worried about the relocation of the fund’s headquarters to Jeonju, North Jeolla, as well as its controversial leadership appointments. Since its headquarters moved to Jeonju in February 2017, many managers have left the NPS, and the chief information officer (CIO) post has been vacant for a year now. Many department and team head posts are also vacant. It is not easy to fill these positions with appropriate talent.

This is a crisis for the NPS. Politicians have been eyeing the NPS whenever the opportunity has risen. In June 2013, lawmakers passed a revision of the National Pension Act that defined the site of the NPS Investment Management as North Jeolla. Then-Saenuri Party lawmaker Kim Jae-won drafted the bill, and Democratic Party lawmaker and current NPS CEO Kim Sung-joo supported the bill. I wondered how the bill would pass the National Assembly, but 209 lawmakers approved it. The revised law stated that the NPS Investment Management, which should have been close to the financial market, would relocate and cannot come back to Seoul. Whenever relocation to Seoul was discussed, Kim Sung-joo argued that the National Pension Service Investment Management was like the Dokdo of North Jeolla, and lawmaker Kim Gwang-soo said that politicians wouldn’t allow it.

The appointment of the CIO is not free from Blue House influence. Past administrations have chosen someone close to power. Most CIOs did not finish their three-year tenure. Kang Myun-wook resigned after a year and five months.

But Anne Stausboll, who was the CEO of California Public Employees’ Retirement System (CalPERs) in the United States, served for seven years from 2009. The former CEOs of the Canada Pension Plan Investment Board (CPPB) served four and seven years respectively. The Swedish National Pension Fund, or AP Funds, is divided into six parts and operated independently, and the government receives reports on the outcomes. Former and incumbent fund managers envy the United States and Canada. They said that the CIO needs to have qualification and ethics, and that political inclinations do not matter.

“My pension is worth it,” says a citizen in a recent NPS commercial. However, many people associate the NPS with distrust and exhaustion. While politicians shake up the pension fund, it is future generations that suffer. When earnings fall, there is no immediate problem. But when the fund runs out 20 or 30 years later, the future generation will need to fill it up. There should be only two standards to judge the NPS by — profitability and stability. It does not belong to the government.

JoongAng Ilbo, July 20, Page 29
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