"Disaster Fund Support for Small Business Owners and Vulnerable Groups" ... Special Provisions Passed at Cabinet Meeting

Due to the impact of the novel coronavirus disease (COVID-19), a temporary closure notice is posted on a small business store in Jung-gu, Seoul on the 4th. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Jo In-kyung] The scope of use for the 3.8 trillion won disaster management funds held by local governments has been expanded to allow support for vulnerable groups and small business owners struggling due to the novel coronavirus infection (COVID-19).

The Ministry of the Interior and Safety announced that the amendment to the "Enforcement Decree of the Framework Act on Disaster and Safety Management," which includes this provision, passed the Cabinet meeting on the 31st.

Disaster management funds are created by each local government annually setting aside a certain percentage of general taxes to cover costs related to the prevention, response, and recovery from various disasters. Currently, about 3.8 trillion won is accumulated, of which approximately 15% is separately reserved and managed as mandatory deposits for large-scale disasters.

The amendment includes a special provision stating that "disaster management funds and mandatory deposits can be used as local resources for disaster management to support small business owners and vulnerable groups experiencing economic difficulties due to COVID-19."

Accordingly, from now on, each local government can use disaster management funds to support vulnerable groups and small business owners whose incomes have decreased due to COVID-19, such as through 'disaster basic income' or 'emergency disaster living expenses,' without separately revising ordinances.

Jin Young, Minister of the Ministry of the Interior and Safety, said, "With this amendment to the enforcement decree, it has become possible to support small business owners and vulnerable groups facing economic difficulties in emergency economic situations," adding, "It is expected to help stabilize people's livelihoods, recover the local economy, and respond to COVID-19."