The Executive Yuan approved a plan allowing individuals under the old labor pension system to voluntarily contribute to retirement savings [1].
This move provides a financial bridge for workers who remained in the legacy system, offering them a pathway to the modernized individual account structure. By allowing the transfer of funds, the government aims to stabilize long-term retirement security for a segment of the workforce that previously lacked this flexibility.
According to the Executive Yuan, the approved plan will "allow people using the old labor pension system to voluntarily contribute to their retirement savings and transfer funds into individual accounts under the new system" [1]. The decision facilitates a transition that was previously restricted, giving workers more control over their retirement assets.
The shift focuses on individual accounts, which differ from the collective nature of the old system. Under the new framework, contributions are credited to the specific worker, reducing the systemic risk associated with the older model's funding structure.
Officials said the plan is designed to ensure that workers can optimize their savings based on current economic conditions. The transition process allows for a voluntary migration, meaning workers are not forced to switch but are given the legal mechanism to do so if it benefits their financial future [1].
This administrative change follows a broader effort by the government to modernize labor laws and financial protections. The Executive Yuan said the measure is intended to provide a more sustainable approach to elderly care, and income stability, as the workforce ages [1].
“The Executive Yuan approved a plan allowing individuals under the old labor pension system to voluntarily contribute to retirement savings.”
This policy shift reduces the government's long-term liability by moving participants from a defined-benefit style system toward a defined-contribution model. By enabling voluntary transfers to individual accounts, Taiwan is mitigating the financial pressure on the state pension fund while providing workers with portable, transparent retirement assets.
