A key part of public pension reforms being weighed by the government concerns expanding the coverage of the employee pension system so more workers in irregular jobs such as part-timers can join. Widening the coverage by requiring more companies to have their part-time employees participate will not only add to the benefits those workers receive in retirement but shore up pension finances by increasing the number of participants in the program.
Such a measure will be necessary as the pension payout level is set to decline sharply in real value due to the rapidly aging and declining population. Major reform has been shelved for years due to objections from the business sector, especially small and medium-size companies that fear the financial burden of paying for workers' pension premiums. But it is important to set the stage for substantially expanding the coverage of employee pensions to prevent future increases in retirees in dire economic straits with only meager benefits.
Popular interest in — and concern over — the public pension system surged after the Financial Services Agency, in a report compiled before the Upper House election in July, cautioned that a model household consisting of a retired couple that relies on pensions for income will fall short by ¥20 million of the amount needed to cover their expenses to the age of 95.