According to the report “2025 Elderly Policy Budget Analysis” by the Korea Institute for Health and Social Affairs, the proportion of this year’s central government social welfare budget allocated to the elderly sector has surpassed 50%, amid South Korea’s transition to a super-aged society as of the end of last year.
The report, released by Song Chang-gil, associate research fellow at the Social Security Finance Data Research Lab, indicates that the total budget for the central government’s social welfare sector this year is 229.1 trillion won, with the elderly sector accounting for 115.8 trillion won, making up 50.6% of the budget, exceeding half for the first time.
Compared to 2018, the overall social welfare budget increased from 133.8 trillion won to 1.7 times that amount, while the elderly sector’s budget nearly doubled from 58.8 trillion won. The proportion of the budget dedicated to the elderly, which remained in the early 40% range from 2018 to 2022, rose to 45.9% in 2023 and 47.5% in 2024, finally surpassing 50% this year.
Specifically, within this year’s elderly budget, public pensions, including the national pension scheme, account for 76.3%, “elderly livelihood stability” makes up 21.5%, and “elderly medical security” comprises 2.6%. The proportion of the national pension within the public pension sector increased significantly from 44.3% in 2018 to 54.8% by 2025. Meanwhile, the proportion for special occupational pensions has generally declined, with the civil servant pension dropping from 34.9% to 30.4%, and the military pension from 6.7% to 5.0% over the same period.
Within the elderly livelihood stability category, the basic pension represents the largest portion at 88.3%, although it is slightly lower than the 91.5% in 2018. The budget for elderly job creation projects surged from 600 billion won in 2018 to 2.2 trillion won by 2025, a 3.4-fold increase.
Local governments’ budgets for the elderly sector have also continued to increase. In 2018, 31.2% of the local governments’ social welfare budgets, totaling 93.5 trillion won, were allocated to the elderly sector, which rose to 34.5% of a 171 trillion won budget by 2024.
Regional budgets for the elderly sector vary significantly based on the fiscal independence and aging rate of each local government. Regions with high aging rates, such as Jeonnam, Gyeongbuk, and Gangwon, face relatively high spending burdens for the elderly, yet their low fiscal independence limits the implementation of their projects.
Song Chang-gil emphasized that the increased fiscal burden due to aging highlights the potential differences in the provision of elderly welfare services based on regional financial conditions and levels of aging. This underscores the need for policy considerations to address disparities in elderly welfare between regions.