Japan Pension Rate Seen Falling to 50.8 Pct in FY 2047
Newsfrom JapanPolitics Lifestyle
Tokyo, Aug. 27 (Jiji Press)--The proportion of public pension payments to disposable income at working generations in Japan is projected to fall to 50.8 pct in fiscal 2047 from 61.7 pct in fiscal 2019 under a standard scenario assuming real economic growth of 0.4 pct in the medium to long term, the welfare ministry said Tuesday.
The estimated decline reflects a built-in system that curbs growth in pension payments so as to secure resources for future payments despite the aging of society and sluggish birthrates. The figure for fiscal 2047 is above the legally required level of 50 pct, but could decline further if the economy fails to attain the assumed growth rate under the scenario.
The previous estimates, released in 2014, projected that the rate would bottom out at 50.6 pct under a standard scenario.
The latest estimates assume that Japan's fertility rate, or the average number of children a woman gives birth to in her lifetime, will remain around the current level of 1.44 in 2065. Other conditions taken into account included strong economic growth for the near term and a rise in labor participation by women and elderly people.
The ministry worked out six scenarios including the standard one. For two scenarios assuming slow or flat medium- to long-term economic growth, the proportion of pensions to working generations' disposable income is estimated to fall to 44.5 pct to 46.5 pct in the 2050s.
[Copyright The Jiji Press, Ltd.]