South Korea's social security spending is projected to reach 27% of gross domestic product (GDP) by 2065, 1.7 times this year's level.
Prime Minister Kim Min-seok chaired the 35th Social Security Committee meeting at the Government Complex Seoul on Wednesday, where the revised third basic plan for social security and the sixth social security fiscal projection, reflecting the Lee Jae-myung administration's welfare agenda, were reviewed.
According to the projection of social security expenditure from this year through 2065, the share of social security spending in GDP is expected to expand from 16.2% this year to 27% in 2065, roughly a 1.7-fold increase. By 2040, the ratio is projected to reach the Organization for Economic Cooperation and Development (OECD) average, which stood at 20.5% as of 2022.
The social security fiscal projection, conducted every three years, forecasts medium- to long-term fiscal requirements on the assumption that current systems remain in place.
Spending on old age and health care is expected to rise particularly sharply within the social security sector, driven by low birth rates and an aging population. Old-age spending is projected to grow from 4.5% of GDP this year to 11.8% in 2065, reflecting an expanding elderly population and a rising number of pension recipients. Health care spending is forecast to increase from 5.8% to 9.9% over the same period, amid growing demand for medical services and long-term care.
