The Vice Minister Says Legalizing Loss Compensation Is Difficult... Ministry of Economy and Finance Issues Clarification Late at Night

Press release circulated in less than a day... "Introducing overseas cases does not mean opposition to institutionalization"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The Ministry of Economy and Finance, which had expressed opposition to the legislation of loss compensation for small business owners, reversed its stance in less than a day. When Prime Minister Jeong Seyeon emphasized the necessity of a legal system by stating, "A legitimate way to compensate the people must be opened," the ministry's vice minister initially expressed difficulty, but later clarified that this was not their intended meaning.

On the night of the 20th, the Ministry of Economy and Finance briefly stated in a press release, "We are exploring various measures to alleviate the difficulties of vulnerable groups such as self-employed individuals due to the novel coronavirus infection (COVID-19)." The timing of the release was sudden, and since it contradicted the vice minister's remarks, it was considered unusual.

The explanation stemmed from Vice Minister Kim Yongbeom's remarks opposing Prime Minister Jeong's comments. On the same morning, Prime Minister Jeong said on a radio broadcast, "The state needs to compensate for losses caused by restrictions on business operations due to national necessity," urging the institutionalization of compensation. Vice Minister Kim drew a line on this. At a briefing of the Central Disaster and Safety Countermeasures Headquarters held at the Government Seoul Office in the afternoon, Kim expressed reluctance regarding the 'Self-Employed Loss Compensation Act,' saying, "There are various discussions overseas about support methods and means for small business owners," and "It is not easy to find countries that have legislated such compensation overseas."

As reports continued that the Ministry of Economy and Finance had contradicted the Prime Minister's proposal through the vice minister's remarks, the 'midnight press release' was eventually issued. Especially since Prime Minister Jeong revealed that President Moon Jae-in also sympathized with this, it is evaluated that the ministry felt even greater pressure.

In the press release, the Ministry of Economy and Finance stated, "Regarding the legislation of loss compensation for the self-employed, we introduced the results of analyzing overseas cases," and "Reports that the Ministry opposes the legislation of loss compensation for small business owners are not true," attempting to clarify the situation.

The Ministry of Economy and Finance had also expressed opposition when pushing for the payment of nationwide disaster relief funds in April last year, which led to Prime Minister Jeong publicly reprimanding them, exposing conflicts to the surface.

After the ministry's clarification, Prime Minister Jeong officially endorsed loss compensation for COVID-19 business restrictions. On the 21st, at a meeting of the Central Disaster and Safety Countermeasures Headquarters, he said, "Appropriate support is needed for those who could not operate their businesses properly due to following government-set quarantine standards, and it is time to consider institutionalizing this."