Lower house passes bill allowing delayed pension payout

May 13, 2020 | News On Japan

May 13, 2020 (Japan Today) - Japan's lower house passed a bill Tuesday revising the pension law, allowing people to start receiving benefits as late as age 75, with the rapidly aging country seeking to let more seniors stay in or join the labor market.

The current law on the country's public pension scheme sets the payout age at 65 in principle, though it allows people to start receiving benefits between 60 and 70. The bill expands that age band to 60 to 75.

For every month people delay the start, their benefits will be increased by 0.7 percent. That means if someone starts receiving their pension from age 75, the monthly amount will be 84 percent more than when if they started at 65.

The bill, which is expected to pass the upper house during the ongoing Diet session through June, also calls for a review of the system of reduction in payments from the employee pension program for working seniors with certain levels of income amid criticism it has demotivated seniors from joining the workforce.

Under the current system, people aged 60 to 64 whose monthly wage is more than 280,000 yen are subjected to the reduction, but the bill raises that amount to more than 470,000 yen, the same level as those aged 65 or older.

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