Social policy system in the Republic of Korea: features of development and performance

Podolskiy Vadim Andreevich PhD in Politics Associate Professor of the Faculty of Political Science; State Academic University of Humanities 26 Maronovsky Lane, Moscow, 119049, Russia deomniscibili@yandex.ru Other publications by this author

The article was prepared with financial support within the framework of the implementation of the State Budget (state task) of the National Academy of Sciences on the topic "Modern Information Society and Digital Science: cognitive, economic, political and legal aspects" (FZNF-2020-0014).

Acknowledgements: The article is prepared with financial support as part of fulfillment of the SA (State Assignment) for the State Academic University for the Humanities on the subject “Contemporary information society and digital science: cognitive, economic, political and legal aspects” (FZNF-2020-0014).

Introduction

The subject of this research is the effectiveness of social policy in the Republic of Korea. The relevance of studying social policy in the Republic of Korea is related to the search for successful strategies in the field of social policy. Modern developed countries are characterized by the problem of collision, according to the formula of the American political scientist Paul Pearson of "irresistible force" and "immovable object". Due to the aging of the population, the demand for services and payments in the social sphere is increasing, and the receipt of taxes or insurance contributions to finance them may lag behind the increase in expenditures, resulting in an increase in the tax burden and budget arrears, since cuts in social programs are usually perceived as politically unacceptable ^[43]. The problem of population aging in Korea is one of the most acute in the world. The creation and reform of social policy measures in Korea to respond to challenges related to demography and the economy, therefore, require study to assess the effectiveness of possible reform options in other States.

There are a large number of foreign and a number of domestic studies on social policy in Korea. A number of works study the general dynamics of Korean social policy in recent decades, the course of the political struggle for the introduction and adjustment of social protection and insurance measures ^[26]. The authors explain the historical prerequisites for the choice of limited state participation in redistribution ^[45]. The influence of Confucian ethics on the peculiarities of social policy in Korea is studied ^[24]. The differences from the European models of social policy are considered ^[8]. The attention of researchers is attracted by the difficult demographic situation in Korea ^[1]. The formation of a healthcare system with a single insurance scheme is described ^[18.]. There are also reviews of the set of legal norms in the field of social policy that developed at the beginning of the XXI century ^[41]. The structure and features of property inequality in the Republic of Korea and strategies for helping certain groups of the population – youth ^[4] and elderly citizens ^[2] are being studied. The challenges associated with the organization of the pension system and opportunities for reform are considered ^[31].

This paper provides an overview of the features of the formation and functioning of the social policy system in the Republic of Korea. The political, economic and cultural prerequisites that determined the forms of organization of social policy are shown. The key demographic and economic problems that modern social policy in Korea is trying to respond to are considered. The description of the social policy system in Korea is structured according to problems – the healthcare system is evaluated, then the pension system, then other areas of social support, including demographic programs, then the education system.

Methodology

To assess the effectiveness of the pension system, information such as the level of income replacement with pension payments and the proportion of poor citizens among the elderly population are used. Effective pension systems are characterized by high levels of income substitution and a lower proportion of poor citizens among the elderly than the national average. To assess the quality of the healthcare system in Korea, the dynamics of life expectancy in the country, the level of the "burden of disease" and its dynamics are studied, as well as, to assess the effectiveness of insurance mechanisms, the share of direct payments from the population in medical expenses. To assess the effectiveness of demographic programs, the dynamics of fertility is studied. The educational system is evaluated based on the results shown by students from the Republic of Korea and educational institutions of the country in international rankings. The effectiveness of social programs in Korea and in other countries is compared on the basis of information from the Organization for Economic Cooperation and Development, the Institute for Health Indicators and Assessment, and information from government agencies of the Republic of Korea.

Typology of social policy

According to the classification of Esping-Andersen, who distinguished liberal, conservative and social democratic models of the welfare state ^[10], elements of conservative and liberal approaches are combined in Korea. Some researchers, like Kathleen Jones, have suggested calling the Korean approach to social policy a variant of the "Confucian" model of the welfare state ^[19]. Some authors spoke of Korea as an example of a "welfare state aimed at development" ^[9], pointing out that social policy in Korea was subordinated to the priority of economic efficiency and growth. Economic development in East Asia was organized in such a way that States spent as little money as possible on social needs. States do not so much redistribute resources as act as regulators. Social security depends on employment – receiving payments or services involves regular contributions. The provision of social insurance measures was provided by syndicates, called chaebols in Korea, for their employees. Self-reliance was encouraged. Confucian culture, including those related to the reverence of children towards their parents, assumed that a person would receive the main support from the family ^{[30, p. 472-475]}. Confucianism called for loyalty to the state. In Confucianism, an individual is perceived through relationships with others. The interests of the community to which the individual belongs therefore become more important than the interests of the individual. Confucianism presupposes the rule of a virtuous leader for the sake of unity and harmony of society. The state is perceived as a big family, and the head is perceived as the head of the family ^{[24, p. 44-46]}.

The healthcare system in Korea

State support in Confucian ethics primarily meant the ruler's mercy to his subjects. At the end of the 19th century, Korea faced the need for modernization due to increased geopolitical instability in the region, and the question arose of transforming the role and functions of the state to improve the situation of the population in order to contribute to the strengthening of the state. At the end of the 19th century, the Korean authorities sent officials and scientists to Western countries and Japan to study the health care system, economic and political systems. In their reports, officials talked about the need to create a public health system, improve the quality of water supply and sanitation. At the same time, Western missionaries began to arrive in the country, who, with the help of the Korean government, opened the country's first modern hospital in 1885. In 1895, a sanitation council was established with the participation of Western doctors and Korean officials. The state and missionaries created healthcare institutions, and the state introduced control over the activities of doctors. In 1905-1910, Japan began to control Korea, which created a network of hospitals according to Western standards, primarily aimed at representatives of the Japanese administration, and provincial charity hospitals for the poor were created. Sanitation measures were also introduced. The prevention of diseases was facilitated by the activities of missionaries, who continued to create medical institutions ^{[48, P. 75-80]}. The German insurance model, which Japan adopted at the beginning of the 20th century, was not replicated by Japan in Korea, and Korea created a system of state regulation for financing healthcare independently in the second half of the 20th century, first on a corporate principle, as in Germany and Japan, then on a universalist one. Life expectancy was about 40 years in the 1940s and less than 50 years in the 1950s. During these years, Western sanitation standards were introduced, the quality of water supply and sewerage was improved, Western principles of medical care were introduced thanks to the help of American doctors and the training of Korean doctors in Europe. At that time, North Korea had a universal free health care system, and the general level of well-being in the North was higher until the 1970s, which prompted the state to carry out structural reforms ^{[16, p. 127]}. In 1963, a health insurance system based on contributions from employees and employers was introduced in Korea, but its coverage by the 1970s amounted to only 10% of the population ^{[14, p. 199-200]}. In 1977, the national health insurance system was introduced ^{[30, p. 475]}. At first, it covered enterprises that employed more than 500 people. Since 1979, health insurance has been introduced for civil servants and teachers. Since 1989, the scheme has been extended to the entire population. In 1998, the general scheme and the scheme for civil servants and teachers were combined. The organizations responsible for managing insurance programs at the regional level were merged into the National Health Insurance Service in 2000 ^{[22, p. 487-488]}. In the 1960s and 1980s, the number of doctors tripled, from 7 to 20 thousand ^{[16, p. 199-200]}, more than tripled, to 70,000 by 2000 and almost doubled in the first quarter of the XXI century, to 120,000 ^{[40, p. 60]}. Korea has developed a strong pharmaceutical industry, and already in the 1970s more than half of the medicines consumed were produced domestically ^{[14, p. 200]}, currently more than two thirds, Korea has also become a major exporter of pharmaceutical products ^{[32, p. 44]}.

Contributions to the healthcare system currently amount to 7% of the salary, contributions are divided between the employee and the employer ^{[34, p. 27]}. Contributions are reduced by 10-30% for certain categories of the population – senior citizens, disabled people, orphans ^{[20, p. 204]}. Low–income citizens, whose income is less than 40% of the median, pay only 10% of the cost of services for inpatient care, 15% for outpatient care. There is an annual maximum cost for patients, depending on their income, for most citizens it is about $5,000 for six months, for 10% of the least well–off citizens - $ 1,000 ^{[22, p. 488-489]}. In 1977, a law was passed on tax financing of the free assistance program for the most needy ^{[45, p. 83]}, which is currently used by about 3% of citizens with the lowest incomes. Since national insurance does not cover all expenses, almost all citizens – up to 90% of households – use various additional private health insurance. The share of direct payments from citizens for medical services is higher than in other developed countries, and amounts to an average of about 30% of all medical expenses against 20% on average in OECD countries ^{[40, p. 45-46]}. In 2017, a Health Care Accessibility Expansion Program was launched, named after President Moon Jae-in "Munkair", in imitation of the American Affordable Care Act, known as "Obamacare". The Munkair program was aimed at increasing the share of expenses that insurance would reimburse ^{[20, p. 204]}. The total expenditure on the healthcare system in Korea is comparable to the average for OECD countries and amounts to about 10% of GDP ^{[37, p. 155]}.

The Korean healthcare system has historically been dominated by private medical institutions ^{[30, p. 475]}. In 1986, a model of payments to medical institutions based on groups of similar diagnoses was borrowed from the United States in order to reduce the risks of providing excessive services by medical institutions. According to this system, patients pay 20% of the cost of services, but the principle of payment for service is also maintained for individual services ^{[22, p. 487]}. The health insurance system is managed by two structures subordinate to the Ministry of Health. The first structure is the National Health Insurance Service, which is responsible for collecting all insurance premiums in the country – contributions for long–term care, retirement, unemployment and compensation for work injuries. The National Health Insurance Service is also responsible for organizing prevention projects in the health sector. The second structure is the Insurance Research and Evaluation Service, established in 2000, which is responsible for the level of reimbursement for services, collecting and processing information about medical services provided, assessing their quality and regulating the pharmaceutical industry. Prices for medical services are set annually based on the results of meetings of the National Health Insurance Service and associations of medical service providers ^{[40, p. 46]}. All health care providers receive the same payments from a single payer, so there is no difference between private and public medical institutions for the consumer. A significant role is played by local health centers, which are responsible not only for the provision of medical services, but also for public health and prevention – the prevention of infectious diseases, motherhood and childhood, sanitation ^{[22, p. 485]}.

The rapid progress of the health system in recent decades is reflected in the reduction of the burden of disease. The burden of disease – the number of years of life lost due to illness for every 100,000 - has decreased in Korea from 33 to 17.5 thousand over the past 30 years. This is one of the best indicators in the world, of the large countries, the lower burden of disease is typical only for Japan, where it is 16.2. In the USA, this indicator is 28.6, in Russia – 37.5 ^[13]. Life expectancy exceeded 80 years in 2009 ^{[36, p. 7]}, and in 2024 it is 83 years, this is one of the highest rates in the world ^{[6, p. 16]}.

Pension provision and long-term care

The formation of social support, pension and labor legislation went hand in hand with the development of the medical healthcare system and followed the same logic, from point laws in the first half of the 20th century to a decentralized system in the second half of the century and universalization at the end of the 20th century. The first law on social support in Korea appeared in the middle of the 20th century, when in 1944 the Japanese law of 1929 on assistance to the needy was reproduced in Korea. The volume of aid was extremely small due to the almost complete lack of government resources. Under American military rule, aid was mostly associated with loosely structured religious charity. In 1961, an assistance program for the deserving poor was introduced, which developed the 1944 law ^{[16, p. 45]}. The logic of social support in Korea was focused on stimulating employment. Assistance was provided only to the most needy and in an extremely limited amount according to the principle of least acceptability – any job was more profitable than social assistance. Industrial production was developing in the country, many processes were similar to those that took place during the industrialization of Europe in the 19th century. The creation of industrial enterprises led to the displacement of the population to the cities. Salaries were low, and the labor market was extremely large due to the high proportion of the population employed in agriculture. Rapid economic growth has helped to reduce poverty. The proportion of the population living on less than a dollar a day decreased from 40% to 10% from the 1960s to the 1980s ^{[16, p. 48]}.

In 1960, pension provision was introduced for civil servants to increase the attractiveness of the civil service and the sustainability of employment. Civil servants were also entitled to one-time payments and regular disability benefits, as well as subsidies for medical expenses, payments at the birth of a child, funeral allowances and benefits for widows and widowers. In 1975, a pension system for teachers was established. Voluntary pension insurance for employees of enterprises was established in 1953. In 1961, pension insurance became mandatory for employees of those enterprises that employed more than 30 people, and since 1989 – more than 5 people. From 1961 to 2005, the pension was in the form of severance pay, which was paid to a retiring employee. In 2005, a labor pension was introduced, which provided tax benefits for employees. Employees received individual retirement accounts, which were kept for them when they changed jobs. Since 2010, the labor pension has become available to all enterprises. In 2011, the scheme of individual pension accounts was replaced by the scheme of individual pension plans in order for employees to start such accounts themselves. Since 2017, the scheme of individual pension plans has become available to all categories of the population – civil servants, teachers, the self-employed ^{[39, p. 14]}. The coverage of corporate pensions, which involve relatively generous payments, is 17% of the working-age population ^{[38, p. 219]}.

In order to achieve general coverage of citizens, in 1988, in addition to the pensions of teachers and civil servants and the individual pension schemes of employees of enterprises, a National Pension Scheme was introduced, which also depends on employment. Initially, pension insurance was extended to employees of those enterprises where more than 10 people worked, since 1992 – to enterprises with more than 5 employees. In 1995, the pension became available to farmers and self–employed rural residents, in 1999 - to self-employed urban residents. Citizens with incomes below 10% of the national average do not pay contributions ^{[39, p. 14-15]}. In 2007, in order to ensure the stability of the pension system, a gradual increase in the retirement age from 60 years was initiated, the retirement age should be 65 years by 2034 ^{[7, p. 20]}. The contribution level at the launch of the scheme in 1988 was 3% of salary, from 1993 – 6%, from 1998 – 9%. The expected replacement rate in 1988 was 70% of the salary, in 1998 – 60%, since 2008 – 50%, by the end of the 2020s it is expected to decrease to 40%. Pensions are paid from incoming contributions from citizens, therefore, while maintaining existing contribution levels and the rate of population aging, the National Pension Fund will face a deficit in the 2050s. To maintain the expected level of income replacement, contributions will need to be tripled, to 35%, which is higher than in the country with the highest contributions – Italy, where contributions make up 33% of salary ^{[31, p. 2]}.

To receive a minimum national insurance pension, contributions must be made for at least 10 years, and the maximum – for at least 40 years ^{[39, p. 30]}. Currently, pensions are paid in a limited amount, since the first full pensions will be paid from 2028, after 40 years. Therefore, the level of income replacement with pensions in Korea is lower than in Europe ^{[38, p. 151]}. The share of pensions in Korea's GDP is much lower than in other developed countries, and, according to the OECD, amounts to about 4.5% of GDP against 10% or more in Europe, but this figure is growing rapidly ^{[38, p. 211-213]}.

In 1999, the National Living Wage Act was passed, expanding the 1961 program. All those in need, including the able-bodied, were granted the right to assistance. The number of recipients of cash payments has increased 3–fold, from 1% to 3% of the population ^{[46, p. 428]}, although the level of relative poverty - income below half of the national median – in Korea is about 17%. The program involves a need check – recipients must confirm that they are not being provided with assistance by relatives ^{[30, p. 480]}. Assistance includes subsidies for rental housing, targeted payments for the purchase of food and clothing, child education benefits, payments at the birth of a child and funeral payments, and a number of benefits. Able-bodied recipients were required to look for work ^{[17, p. 176]}. Korea is characterized by an extremely high proportion of the poor among the elderly population. 40% of senior citizens have an income level of less than half of the national median. The situation when the proportion of the poor among the elderly population is higher than among all age groups is unusual for developed countries: on average, according to the OECD, the proportion of the poor – people with incomes less than 50% of the median – among citizens over 65 years of age is 11% versus 14% for the entire population ^{[38, p. 201]}. In 2007, a need-tested pension was introduced, not related to the payment of insurance premiums ^{[39, p. 15]}. The pension is available to citizens over the age of 70 with an income level below a certain minimum and covers 60% of citizens in this age group. The amount of old-age pension for those in need is small and amounts to less than 10% of the average salary ^{[39, p. 78]}.

The proportion of the population over 65 years of age in Korea increased from 7% in 2000 ^{[11, p. 9]} to 19% in 2024 ^{[6, p. 16]}, in the world – from 7% ^{[33, p. 42]} to 10% ^{[6, p. 2]}. By 2050, Korea is expected to overtake Japan in terms of the proportion of the elderly population, which currently has the highest proportion of people over 65 years of age ^{[37, p. 211]}. In 2008, due to the aging of the population, an insurance program for long-term care was introduced ^{[40, p. 46-47]}. Long-term care services are provided by private institutions, but are paid for by contributions collected by the State National Health Insurance Service. The Service also sets rules and standards for industry participants. Long-term care insurance contributions are calculated as a share of health insurance contributions and amount to about 1% of salary. The program is mainly intended for citizens over the age of 65, but in some cases, citizens younger than this age who need long-term care for health reasons can also receive services. Services can be provided by social workers at home, in institutions, and cash payments can also be provided. To reduce the burden on the long-term care system, service recipients must pay 15% of the cost of home care services and 20% of the services received in institutions. For low-income citizens, the amount of surcharges can be reduced by 40-60%. Services are provided free of charge to those citizens who are provided with assistance under the law on the National Living Wage ^{[34, p. 66-78]}.

Labor legislation and demographic programs

The logic of social support legislation in the context of labor regulation in Korea was, like other areas of social support, based on the priority of economic expediency and corporate solidarity. In 1915, when Korea was controlled by Japan, the law on assistance to miners in case of accidents was passed. In 1948, salary-proportional payments were introduced for those citizens who were injured at work. Payments were the subject of a collective agreement between employers and industry unions, so they were usually assumed only at large enterprises. In 1953, the law on employer responsibility was introduced. The program of the First Five-year Economic Development Plan of 1962-1965 assumed a rapid increase in the number of employees of industrial enterprises. Unemployment insurance was discussed, but not introduced, because it was decided that the absence of unemployment insurance would mean the preservation of labor reserves. The country's leadership considered it more appropriate to provide financial and medical support to victims of accidents than to pay the able-bodied unemployed. In 1964, an accident insurance program was introduced, and unemployment insurance was introduced only in 1995. The development of the program began after the economic crisis of the 1990s ^{[16, p. 163-165]}. The level of unemployment benefits is tied to the level of the minimum wage, and benefits are deliberately kept below this level in order to stimulate employment ^{[25, p. 460]}. Youth support programs exist in several regions of Korea. They are provided, according to the logic of social policy established in Korea since the 2nd half of the 20th century, to those citizens who are looking for work, and are primarily aimed at helping them find work and improve their skills ^{[4, p. 59]}.

The policy in Korea in the field of demography in the XXI century has changed significantly compared to the XX century. In the 1960s, the country had a family planning program aimed at reducing the birth rate and increasing per capita income. Over 60 years, the birth rate has decreased by more than 6 times, from 6 to less than 1 child per woman ^{[1, p. 144]}. In 2006, a program of regular payments to families with children to support fertility was introduced, more than $200 billion was spent on it, and in 2021 Korea adopted a new plan for almost the same amount. Starting in 2024, monthly payments for children amount to about $800 per child under 1 year old and $400 per child from 1 to 2 years old. Also in 2023, the maximum period of parental leave was increased from one year to one and a half years ^{[1, p. 147]}. There are lump–sum payments at birth, but their value is relatively small - about 1,800 dollars ^{[3, p. 89]}. In addition to the national policy on increasing the birth rate – and before it, since 2002 – local authorities have been trying to initiate programs to promote population growth within their powers. The State facilitated the exchange of information on programs between municipalities, and initiatives spread rapidly. The most popular program was one-time payments to families in which a child was born. Compensation for medical insurance costs was also offered at the municipal level ^{[23, p. 584-585]}. As part of the program to increase the availability of health services "Munkair", a rule was introduced according to which medical insurance would repay 95% of the cost of services received for children under the age of 15, against 50-80% for adults ^[42]. The state creates 500 kindergartens per year ^{[3, p. 89]}. The availability of kindergartens in Korea is high, and kindergartens are attended by 50% of children under the age of 2 years and 90% of children aged 3-5 years ^{[35, p. 188]}.

Studying the causes of the decline in the birth rate in Korea, researchers highlight a number of changes that have occurred in Korean society in recent decades. The proportion of working women is increasing – if in the middle of the 20th century women worked only before marriage, and about 90% of workers were men, now this gap is disappearing. Since the 1980s, the number of women receiving higher education has been growing, currently their share exceeds 40%. The age of marriage is increasing, and the number of marriages is decreasing. If in the 1990s the average age of a woman in labor was about 26 years old, now it is about 33. According to the results of surveys conducted by the National Bureau of Statistics, the majority of Koreans – almost a third – did not marry because of lack of money, another 14.5% cited unstable employment. Among the reasons for the low birth rate, researchers cite the extremely high cost of housing. For example, the average salary in Seoul is about $40,000 per year, and the price of an average apartment is more than a million dollars. ^{[1, pp. 145-146]}. In 1989, the state initiated a program for the construction of housing for rental on preferential terms ^{[47, p. 14]}. The volume of social housing in Korea is comparable to other countries and accounts for about 6% of the total volume of residential real estate in the country, which is slightly lower than the average for OECD countries of 8% ^{[15, p. 15]}. The share of citizen homeowners is small and amounts to about 50%, which is comparable to Germany, but lower than in the USA ^{[15, p. 30]}.

Education

The high demand for highly skilled labor and the impact of cultural and traditional factors determine the attitude towards education in East Asian countries, including Korea. Universal compulsory education in Korea was introduced in 1948 and was 6 years old ^{[29, p. 30]}. In 1985, the duration of compulsory education was increased to 9 years ^{[29, p. 74]}. High school education – year 10, 11 and 12 -was optional, but almost all students enrolled in high school. Since 2021, high school education has become free ^{[5, p. 38]}. In 1979, a law was passed according to which the State paid school fees for children of citizens who received benefits. Since 1997 – for training in vocational schools ^{[16, p. 49]}. The high quality of school education is confirmed by the fact that Korea occupies a leading position in the PISA ranking, an international student assessment program conducted under the auspices of the OECD ^{[44, p. 57.]}. Some Korean universities are among the best in the world in international university rankings ^{[29, p. 230]}. The unified state exam for admission to universities was introduced in 1994 ^{[29, p. 289]}, and due to its great importance for the further career of a student, it is associated with great stress for schoolchildren. Preparation for the exam begins long before it is passed and usually students attend additional classes and use the services of tutors ^[28]. The system is often criticized because of inequality, since the cost of tutors creates a large burden on family budgets, so citizens with different incomes have unequal access to additional training. The state has tried to smooth out these problems by strengthening exam preparation in schools, but spending on private education has not decreased in the last two decades ^{[21, p. 85]}. Tuition at universities is paid and costs on average about $ 5,000 per year ^{[35, p. 332]}, but students are provided with loans on preferential terms at a low interest rate ^{[5, p. 39]}. The country has high requirements and strict rules for the training of school teachers, as well as serious competition for job seekers as a teacher ^{[27, p.26]}. Salaries of teachers with 15 years of experience are about $4,500 per month, which is higher than the average salary in the country, and also higher than the average for OECD countries of $4,000 per month ^{[27, p. 80]}.Higher education in Korea is more widespread than the average in developed countries due to the influence of traditional cultural attitudes, according to which education meant social mobility and career building ^{[12, p. 75-76]}.

Conclusion

An analysis of the effectiveness of measures and structural features of social insurance, social protection, subsidies, benefits and programs in the Republic of Korea reveals the advantages and disadvantages of solutions in the field of social policy, as well as the causes of the emergence of the principles of state redistribution and regulation characteristic of Korea.

The system of social policy in Korea before the 1970s was extremely limited. Assistance was provided on the principle of least acceptability and to a small number of the population. The family remained the main source of support. The creation and expansion of support measures was carried out in such a way as not to reduce incentives for employment, since the state counted on an increase in well-being due to the rapid development of the economy with a dynamic labor market and minimal government intervention. Some measures were introduced in competition with North Korea. Insurance programs that extended to the most politically significant categories of the population – civil servants, teachers, employees of large enterprises – were subsequently scaled up to the whole country. Some researchers associated the expansion of social programs in the late 1980s with democratization ^{[16, p. 68]}. The reforms of the 1990s were accompanied by political bargaining due to the fact that many bureaucrats and politicians opposed the increase in budget spending due to concerns about its sustainability. The consensus was that support measures should be aimed at maintaining employment, but the high unemployment rate after the crisis served as an incentive to expand social programs ^{[16, p. 73-74]}. Since the Korean social policy system was formed much later than in Europe, the Republic of Korea is inferior to the most developed social states in a number of indicators.

The high level of poverty among the elderly population means that the pension system in its current form does not fulfill the task of replacing income. The situation is aggravated by the fact that, according to the forecasts of researchers, in the near future the pension system will face the prospect of a deficit, despite the increase in the retirement age. The most acute social problem of the Republic of Korea is the low birth rate. The country has had a support program for families with children for more than a decade, but the dynamics of the birth rate has not changed. The main reasons for demographic changes are the high cost of housing, later age of marriage, employment and career expectations of women. The payment system for medical services in Korea assumes that insurance does not reimburse all expenses, unlike most developed European welfare states. But thanks to the quality of technical equipment and training of medical personnel, the Korean health care system is one of the best in the world, which is manifested in a low level of "disease burden" and high life expectancy. There are also public health promotion programs in the country. In terms of the quality of school education, Korea is among the world leaders. Higher education is more widespread than in many other developed countries due to traditions dating back to Confucian scholarship regarding education as a means of career growth. An analysis of the architecture and principles of social policy in the Republic of Korea shows that cultural factors have significantly influenced a number of features of the welfare state in Korea. Among these factors related to the legacy of the Confucian tradition are the pursuit of achievement and status and self-reliance in social solidarity. Another group of factors that influenced social policy in Korea was related to the course of economic modernization in the country in the second half of the XX-early XXI century – a request for dynamism, high demands on employees. Korea has adopted many approaches from Japan, the United States and European countries, but has built an independent and functional social policy system that demonstrates the ability to adapt to changing challenges.