[Asia Economy Reporter Jeon Jinyoung] The Democratic Party of Korea, which is promoting a loss compensation system for self-employed workers, has now proposed a bill to provide closure funds to small business owners. While the Ministry of Economy and Finance initially expressed reluctance to accept the loss compensation system for self-employed workers but eventually changed its stance to agree, the closure support fund bill may become a new point of contention.
The partial amendment to the Act on the Protection and Support of Small Business Owners, jointly proposed by Democratic Party lawmaker Jeong Cheong-rae on the 17th, mainly includes the provision of closure support funds as part of support for small business owners. Lawmaker Jeong explained the reason for the proposal, stating, "Due to the combined effect of decreased sales and increased costs caused by COVID-19, the acceleration of business suspension and closure among small business owners has become a serious social and economic problem," and added, "Measures that can provide self-employed workers with opportunities to restart are urgently needed."
Under the current law, instead of financial support, the Small Business Closure Support Center provides support for re-starting businesses, job training, and job placement for small business owners who have closed their businesses. During the 20th National Assembly, then-Democratic Party lawmaker Hong Eui-rak proposed a bill to establish the Small Business Closure Support Center to also provide financial support, but due to opposition from opposition parties, the financial support provision was ultimately removed and an alternative bill was passed.
As such, the passage of financial support policies following loss compensation is expected to face difficulties. Previously, the Ministry of Economy and Finance also voiced a different opinion from the party regarding the scale of the supplementary budget related to the 4th disaster relief fund.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
