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Old-age income security has become one of the most important social policy issues in two East Asian emerging welfare states, South Korea and Taiwan, as they transform at a remarkable pace into societies with a representation of older people approaching that of western countries. During the last two decades, the two countries have developed different forms of social protection for older people. South Korea has expanded social insurance pensions with means-tested benefits, whereas Taiwan has introduced flat-rate old-age allowance programmes that exclude the rich rather than target the poor. much has been written about these programmes, but their actual performance in reducing old-age poverty has not been thoroughly examined. This paper analyses the anti-poverty effect of these programmes, firstly by describing recent developments in the two countries, and secondly by examining headcount poverty rates and the size and incidence of the 'poverty gap' using nationally-representative micro-household datasets. We argue that while the programmes have increasingly reduced old-age income security, the different policy choices have resulted in distinctive welfare outcomes in the two countries. In the final section of the article, we discuss the long-term implications of the recent policy reforms. [ABSTRACT FROM AUTHOR]

The South Korean National Pension scheme was instituted in 1988 and now covers all private-sector employees and the self-employed. Since the financial crisis of 1997, however, it has become controversial and is under considerable pressure, not least because of the perceived financial implications of the country's rapidly ageing population. Predictions of financial shortfalls or ‘unsustainabiity’ have prompted calls for severe ‘downsizing’ of the scheme. The debate on the reform of the scheme has been dominated by the need to respond to demographic change in ways that assist the national economy, invariably by reducing social expenditure. The debate, however, has given little attention to the social or welfare functions of the pension scheme, though the material insecurity of older people has been exacerbated by major changes in the labour market and the family. This paper details recent socio-demographic changes in Korea and discusses their implications for old-age security and pension reform. It argues that public-pension schemes should be developed to strengthen social protection against the insecurities of old-age, that intra-generational redistribution should be at the core of the reformed arrangements, and that the introduction of a comprehensive non-contributory pension scheme should be seriously considered. [ABSTRACT FROM AUTHOR]