Will Public Servants' Pension Arrears Payment Default? Li Laixi Slams Lai Administration for 'Distorting Law': 'Then Solve It Politically'

In late 2025, Taiwan’s Legislative Yuan passed amendments to halt pension cuts for public servants and teachers, resulting in retroactive payments to approximately 180,000 affected retirees, which were credited on August 1, 2026. However, media reports indicate that the Executive Yuan’s proposed budget for the next fiscal year does not include funding for these payments, sparking concerns among retirees that the policy may be reversed.

In response, Li Laixi, a leading figure in the anti-pension reform movement and former chairman of the National Association of Public Employees, posted a strong critique on Facebook. He accused the DPP government of deliberately politicizing a legal issue and distorting the original intent of the legislation passed by the legislature. “The starting date for the new pension standards for public servants and teachers—should it be January 1, 2024, as clearly stipulated in the law, or December 28, 2025, the date the amendment took effect? This is simply a basic legal interpretation issue. Legal matters should be resolved legally. But the DPP government is deliberately politicizing it and misrepresenting the legislature’s intent. If so, then political issues must be resolved politically,” he stated.

The 2018 pension reform, implemented on July 1, included phasing out the 18% preferential savings rate and gradually reducing the pension replacement rate for public servants and teachers from a maximum of 75% down to 60% (a 1.5% annual reduction). However, in late 2025, the Legislative Yuan passed amendments to the Public Servants Retirement, Discharge, and Pension Act and the Public School Staff Retirement, Discharge, and Pension Ordinance. These amendments halted the annual reduction in pension replacement rates that was set to begin in 2024, reverting calculations to the 2023 standard.

According to the Ministry of Examination, the 'pension arrears' arising from recalculations between the law’s effective date (December 28, 2025) and July 31, 2026, will be fully paid by all relevant agencies by August 1, 2026.

However, concerns remain about whether over-deducted pension amounts have been fully reimbursed. In June, the Ministry of Examination issued a notice confirming that retroactive payments for the period from December 28, 2025, to July 31, 2026, would be completed by August 1, 2026, and that revised pension decisions and income statements had already been delivered to retirees through disbursement agencies. Minister of Examination Shi Nengjie stated during a legislative inquiry that both the Executive Yuan and the Examination Yuan have filed constitutional interpretations, and if there are no procedural issues, the retroactive payments will proceed as planned on August 1.

Nonetheless, the Executive Yuan and the Examination Yuan hold differing positions. As the civil servants’ pension fund is managed by the Examination Yuan, the Executive Yuan has repeatedly stated it respects the Examination Yuan’s authority in finalizing pension determinations. The relevant bills are currently undergoing constitutional interpretation, and there is hope that the Constitutional Court will issue a swift ruling to clarify legal disputes and provide a basis for future administrative actions.

Li Laixi reiterated his criticism, questioning whether the new pension standards should take effect from January 1, 2024, as explicitly stated in the law, or from December 28, 2025, the date the amendment was promulgated. “This is merely a basic legal interpretation issue—ABC-level stuff. Legal issues should be resolved legally. But the DPP government is deliberately politicizing it and distorting the legislature’s original intent. If so, then political issues must be resolved politically,” he emphasized.

Additional reports from Storm Media highlight the following:

- Will the pension arrears payment default? Li Laixi challenges the Executive Yuan: 'Will you keep denying it?' - Why is the salary increase for current military and public employees retroactive, but not the pension restoration for retirees? Li Laixi accuses the government of hypocrisy: 'Put yourself in their shoes.' - With the pension fund earning over NT$300 billion in surplus, will halting pension cuts lead to early insolvency? Li Laixi points to flawed actuarial data and calls for a review.