Welfare reform and future challenges in the Republic of Korea: Beyond the developmental welfare state?

Since the economic crisis of 1997–98, the Republic of Korea has carried out vigorous social policy initiatives including the reform of the National Pension Programme and National Health Insurance. This paper seeks to answer whether the country’s welfare state has moved beyond welfare developmentalism, by examining the cases of those two programmes. By the reform, the coverage of the National Pension Programme was extended to the whole population; and its financial sustainability and accountability were enhanced. Regarding National Health Insurance, efficiency reform was carried out on the management structure, while reform regarding financing was put on hold. These reforms were in clear contrast to the welfare developmentalism that used to place overwhelming emphasis on economic considerations. Despite these reforms, however, the Republic of Korea’s welfare state faces the issues of ineffectual implementation and lack of financial sustainability of social policy. The National Pension Programme has failed to cover the majority of irregular workers, whose numbers are on the increase, and National Health Insurance needs to find a way to meet increasing health expenditure.