Military, Civil Servant, and Teacher Pension Arrears Deposited: How Much Will Be Received? Lee Lai-hsi Shares Emotional Appeal: Income Replacement Rate Still Not Restored

Eight years after the implementation of the military, civil servant, and teacher pension reform (Nian Gai), a major shift occurred following the passage of the 'halt pension cuts' bill in late 2025. The Ministry of Civil Service (MOSC) announced that retroactive pension arrears for about 180,000 affected retirees will be credited on August 1, 2026. Lee Lai-hsi, former chairman of the National Association of Public Employees, who earlier in July confirmed the completion of preferential deposit interest arrears payments, stated on Facebook today (31st) that the pension arrears for January to July 2026 have finally been credited. He expressed relief, saying this allows retirees to breathe easier after years of struggle. However, he emphasized that while the annual reduction in pensions has stopped, their rights have not been fully restored, and the fight for dignity and justice continues: 'We will not stop until our goal is achieved!'

When will the military, civil servant, and teacher pension arrears be credited? How much will be received?

In his latest post, Lee Lai-hsi confirmed that the arrears for January to July 2026 have been successfully deposited into the old pension accounts. Though the amount is only tens of thousands of dollars, he called it the hard-earned result of years of effort and thanked his allies and opposition lawmakers. While full rights have not been restored, he said this at least relieves retirees from uncertainty about their income and offers some relief amid soaring inflation. Lee pointed out that while minimum wages have risen for ten consecutive years, and labor insurance, national insurance, agricultural insurance, and elderly farmer allowances are adjusted annually with inflation, military and civil servant pensions continue to shrink year after year.

Lee further stated that in an economic environment where average national income hits record highs and government tax revenues consistently exceed targets, and the retirement fund is highly profitable, it is unjust that only military and civil servant pensions were set to decline for ten consecutive years. Without this legislative reversal halting the inhumane annual reductions, how could grassroots civil servants and teachers sustain their retirement as they age and face increasing burdens with decreasing income? 'Which policymaker is so cruel as to gradually strip retirees of their sole livelihood in such a reverse torture?' he questioned. In closing, he stressed that although pension cuts have stopped, rights remain unfulfilled. The shadow of ten years of reductions persists. He demands restoration to pre-2019 income levels, arguing that the 2019 reform violated justice and the government’s principle of trust protection.

What is the income replacement rate standard after the halt in pension cuts? When will the pension arrears be paid?

The military and civil servant pension reform was initiated in 2017 and officially implemented on July 1, 2018. Key measures included phasing out the 18% preferential deposit rate and reducing the income replacement rate for civil servants and teachers from a maximum of 75% to 60%, decreasing by 1.5% annually. However, at the end of 2025, the Legislative Yuan passed amendments to the Civil Servants Retirement Act and the Public School Staff Retirement Act, halting the annual reduction in pension benefits that began in 2024 (January 1, 2024), and freezing the calculation at 2023 levels. Due to the need for pension recalculation, the process took months and was finalized recently. The 'pension arrears' resulting from recalculation between the effective date of the law (December 28, 2025) and July 31, 2026, will be paid by all agencies by August 1, 2026.

The Ministry of Civil Service stated that the pension arrears for military, civil servants, and teachers will be paid on August 1. On the left is Minister Shih Neng-chieh. (Photo credit: Liu Wei-hung)

How to apply for the new preferential deposit? Was the constitutional review of halting pension cuts a fake issue?

On July 8, Lee Lai-hsi congratulated the Executive Yuan on approving a 4% across-the-board salary increase for military, civil servants, and teachers in 2026. He also revealed that he had completed the 'retirement preferential deposit' procedure at Taiwan Bank (Taiwan Bank) based on a reassessment notice and had already received the preferential deposit interest arrears for January to July. 'It’s now certain that next month’s pension will be paid under the new standard. The Ministry of Civil Service has finally woken up!' he said. However, he criticized that the constitutional review of halting pension cuts was merely a 'fig leaf' used by the ruling DPP administration to deflect public pressure, as the pension reform applies equally to both active and retired personnel without increasing government budget. 'Now we wait for August 1 to see the real results!'