Promotion of a Uniform 20,000 KRW Communication Fee Payment for Ages 13 and Above
Care Coupons for Elementary Students and Support Funds for Unemployed Youth
Deputy Prime Minister for Economy Hong Nam-ki and Kim Tae-nyeon, floor leader of the Democratic Party of Korea, are attending the 2021 budget formulation party-government consultation held at the National Assembly on the 26th, talking during the meeting. Photo by Yoon Dong-joo doso7@
[Asia Economy Reporter Jang Sehee] The second round of disaster relief funds, scheduled to be distributed before Chuseok, is expected to include support for self-employed individuals and small business owners, as well as child care coupons and communication fee support for those aged 13 and older. Critics argue that the inclusion of policies close to universal payments undermines the original intent of targeted, customized support.
According to the ruling party, government, and Blue House on the 10th, the government will submit a fourth supplementary budget (supplementary budget) worth around 7 trillion won to the National Assembly on the same day. Due to strengthened social distancing measures, 2 million won will be uniformly provided to all high-risk facilities whose operations have been suspended, except for entertainment bars and karaoke bars among the 12 high-risk facilities. Additionally, 500,000 won will be given to unemployed youth per person, and child care coupons worth 200,000 won will be provided to households with preschool and elementary school children. Furthermore, a communication fee of 20,000 won will be paid to all citizens aged 13 and above.
According to multiple government officials, the Democratic Party strongly advocated for child care coupons and communication fee support for those aged 13 and older. As complaints erupted from people who did not receive disaster relief funds, the government hastily decided to split the budget to provide support.
Initially, the ruling party and government planned to provide communication fee support only to those aged 17-34 and 50 and above, excluding those aged 35-49. However, after backlash from the excluded groups, the policy shifted from selective to universal payments. According to the resident registration population statistics in August, those aged 13 and older (46.4 million people) account for 89.5% of the total population. Regarding the 500,000 won payment to long-term unemployed youth, some interpret it as an effort to appease the strong opposition from people in their 40s and 50s.
Of the supplementary budget, expected to be in the mid-7 trillion won range, 5 trillion won will be allocated to support self-employed individuals and small business owners, while the remaining 2 trillion won will be distributed to cover communication fees, long-term unemployed youth, and households with elementary school children, thereby broadening the scope of support. However, this contradicts the original intent of the fourth supplementary budget, which was to prioritize support for those affected by COVID-19. It also conflicts with President Moon Jae-in’s earlier statement that "while the idea of providing funds to all citizens has merit, the financial reality makes it difficult."
As a result, concerns have been raised that the already severe fiscal deficit will worsen. According to the 'September Fiscal Trend' report released by the Ministry of Economy and Finance on the 8th, the management fiscal balance, which reflects the actual fiscal condition excluding social security funds, recorded a deficit of 98.1 trillion won, more than double the deficit of 48.2 trillion won during the same period last year. Additionally, central government debt stood at 781 trillion won as of the end of July, an increase of 82 trillion won compared to 699 trillion won at the end of last year.
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