‘Pension falsification rampant’ in Ibaraki Pref.

Some social insurance offices in Ibaraki Prefecture falsified company managers’ average monthly earnings that will be used as the basis for calculating their pensions, and deleted 10 percent of companies’ delinquent accounts from official records, according to sources close to the office.

The sources said some of the offices falsified data to make their pension premium collection rates appear higher than they really were. The sources also said there was a so-called Ibaraki rule, which stated that only monthly salaries of management-level employees would be lowered and the offices had been provided with software that had been programmed to automatically calculate the delinquent accounts to be deleted.

According to pension insurance premium collection records for fiscal 2005, which The Yomiuri Shimbun acquired, of the 1.4 billion yen in past delinquent accounts, 145.02 million yen was erased at the Tsuchiura Social Insurance Office. At the Mito Minami Social Insurance Office, 84.08 million yen, or about 4 percent of its 2 billion yen worth of delinquent accounts, was deleted.

The two offices’ deleted amounts far outstripped the 150,000 yen to 6 million yen deleted at the other three offices in the prefecture the same fiscal year.

According to the sources, the office summoned managers of companies that had failed to pay premiums and first unsettled them by seizing their companies’ deposits and savings before asking them to sign an agreement to “pay the arrears,” which actually amounted to an agreement to take part in the delinquent account deletion scheme.

The sources said pension office staff persuaded many of the managers to lower the salaries listed in the pension records. For example, an official would ask a manager, “Your executive salary is registered as 500,000 yen here but it’s actually 200,000 yen, isn’t it?” adding, “If you agree to correct the salary, your company’s delinquent account total will be reduced by 10 million yen.”

The Ibaraki rule restricted the targets of this “persuasion” to corporate managers and their families, as it was seen as unfair for regular employees to have their future pension payouts reduced.

The software used to calculate which delinquent accounts should be deleted was distributed to pension officials responsible for collecting the premiums via USB memory sticks in fiscal 2002.

Ibaraki Prefecture’s collection rate for employee pension insurance premiums was ranked 46th among the nation’s 47 prefectures from fiscal 2001 to fiscal 2003. But it shot up to the 37th in fiscal 2004 and 24th in fiscal 2005.