Government Commissioners on the National Pension fund management committee recently increased from five to six, according to reports on the 22nd. The government's influence in the committee's decision-making has grown to as much as 33.3%. Some observers are saying, "The National Pension is being actively mobilized to defend the exchange rate under this administration, and there may be more cases in the future where the National Pension is used as a policy tool."
The National Pension fund management committee is the body that makes key decisions on the investment policy direction of the National Pension fund and how to allocate asset. Until now, the committee had 20 members in total, with five government Commissioners among them. But with the separation of the Ministry of Finance and Economy and the Ministry of Planning and Budget, the number of government Commissioners increased to six. The total number of fund management Commissioners also grew from 20 to 21.
Accordingly, the government's share in the committee's decision-making power expanded from 25% to 28.6%. If Kim Sung-ju, the National Pension Service (NPS) chairman, who is appointed upon the recommendation of the Minister of Health and Welfare and the president's approval, is considered a government appointee, the government's sway could be said to have grown to as much as 33.3%.
With the committee's composition changed in this way, the first meeting is set to be held on the 26th. It is unusual for an emergency meeting to be held in January like this. The agenda is reportedly expected to be a plan to increase the National Pension's allocation to domestic stocks. Earlier, President Lee Jae-myung said in a Health and Welfare Ministry briefing late last year, "As domestic stock prices have risen, the National Pension has exceeded its stock holding limit," and "There are comments that if the National Pension holds more domestic stocks while the domestic market is doing well, that would be beneficial and help secure people's retirement."
Experts worry that the government's influence could grow in the fund management committee, which should put profitability and independence first. Yoon Seok-myung, an honorary research fellow at the Korea Institute for Health and Social Affairs and an advisory member of the special committee on the National Pension, said, "The National Pension fund will more actively represent the government's position going forward," adding, "People's retirement funds must not be distorted into a policy tool."
Kim Hak-joo, head of the Department of Social Welfare at Dongguk University and an advisory member of the special committee, also said, "From a long-term perspective, we need to examine whether increasing the share of domestic stock investments helps the pension's profitability," adding, "The National Pension Fund could send a negative signal to the market that it is not politically neutral."