At a time when people's trust in the nation's pension system has practically vanished due to pension records scandals, a panel of the Social Welfare Council, an advisory body to the welfare minister, is discussing problems related to the government's 2004 decision on dealing with pension issues.

It may be difficult for the council to propose drastic changes to the pension system in a short time. But the council should at least address problems that require quick action and can be resolved with relative ease. Such a move will contribute to restoring people's trust in the pension system.

In 2004, the government decided to gradually increase premium payments for the kosei nenkin pension system for company workers from the current level of about 15 percent of workers' salaries (half paid by companies) to 18.3 percent in the future. The aim was to ensure that the level of pension benefits for retired company workers would be 50.2 percent of the income of working people. It also decided that tax money would be used to cover half of the "basic" portion of pensions by April 2009, up from one-third.

The biggest issue is whether to continue the current system of having people pay premiums to cover a sizable part of the basic portion or to start covering all of the basic portion with tax money. If tax money is used to cover the basic portion, there will be no problems related to the failure to pay premiums. But people will have to pay more taxes in one form or another. This issue is so crucial that it is impossible to find an answer immediately.

The panel is discussing less fundamental but important issues, such as including irregularly employed workers in the kosei nenkin pension system, shortening the current 25-year minimum period of making premium payments before one qualifies to receive the basic portion, and padding benefits for people whose pension benefits are extremely low.

The panel may have a hard time reaching consensus on these issues because it will have to discuss the issue of revenue sources and financial burdens. But the discussions will help restore people's trust in the pension system.