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2018.03.02

【Aging, safety net and fiscal crisis in Japan】No.47: The Defined Contribution Pension is Growing Fast

In this column series, Yukihiro Matsuyama, Research Director at CIGS introduces the latest information about aging, safety net and fiscal crisis in Japan with data of international comparison.

The defined contribution pension (corporate type) is steadily increasing as the third layer of the pension system. This is a pension scheme offered by an employer and approved by the government. In principle, the employer contributes funds, but employees can also contribute based on the terms of the agreement. The defined contribution pension (individual type) is the second layer of the national pension system. In November of 2017, there were a total of 6,414,000 individual subscribers, and by December of 2017, there were a total of 5,669 corporate plans (Figure 1). As shown in Figure 2, it is noteworthy that the number of subscribers jumped from 430,929 in March of 2017 to 744,690 in December of 2017.


Figure 1 Number of Defined Contribution Pension Plans (Corporate Type)

180225_matsuyama_fig01.png


(Source)Pension Fund Association



Figure 2 Number of Subscribers to the Defined Contribution Pension (Individual Type)

180225_matsuyama_fig02.png


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