[Exclusive] 'Idolbom' Budget Exists but Unused... 35.6 Billion Won Unspent Last Year [The Quagmire of Care]

②Analysis of Childcare Budget
Local Government Budget Execution Rate at 89.9%
Ministry of Gender Equality and Family "Encourages Execution in Each Local Government"
Kim Hangyu "No Signs of Improvement"

Editor's NoteLast year, the number of households applying for childcare services reached 120,000, but the number of childcare workers remained in the 20,000 range. To find a solution to the 'care gap' issue, Seoul City launched a pilot project introducing 'foreign domestic workers,' but there is still a long way to go before a smooth transition. This series of three articles diagnoses the fundamental causes and solutions related to the childcare issues facing Korean society.

Amid the ongoing shortage of childcare supply, it has been found that approximately 35.6 billion KRW of the childcare project budget used by local governments last year went unspent. Despite the remaining unused budget, the government’s support has expanded, leading to an increase in this year’s budget. While the budget continues to grow, it is not being effectively utilized on the ground.

According to data on the '2023 Local Government Actual Execution Rate' submitted by the Ministry of Gender Equality and Family to the office of Kim Han-kyu, a member of the Democratic Party, on the 25th, the actual execution rate of local government current subsidies for the childcare support project last year was 89.9%, leaving about 35.6 billion KRW unused. The actual expenditure was 317.594 billion KRW out of a budget of 353.165 billion KRW. As of July this year, out of the main budget of 466.518 billion KRW, 334.443 billion KRW has been spent, representing 71.7% utilization.

Government Seoul Government Complex, Ministry of Gender Equality and Family. Photo by Hyunmin Kim kimhyun81@

Currently, the childcare support project is a local government current subsidy project, where local governments allocate necessary expenses for the project with approval from the Ministry of Gender Equality and Family. The detailed projects include childcare allowances, training and management of childcare workers, operation of service provider institutions, and operation of metropolitan support centers.

Despite the unused funds last year, this year’s budget has significantly increased. Typically, when there is an unused amount in the previous year’s budget, the next year’s budget is set lower considering that. However, based on last year’s settlement of 354.59 billion KRW, this year’s main budget is 467.866 billion KRW, an increase of about 113.4 billion KRW (32.0%). The budget allocated for next year is also 513.428 billion KRW, up by about 45.6 billion KRW (9.7%).

According to the September review report of the National Assembly’s Gender Equality and Family Committee, the actual execution rate for detailed projects such as childcare allowances was in the 80% range. The review report pointed out, "The low actual execution rate of childcare allowances is due to the shortage of childcare workers despite the demand for the childcare allowance project, resulting in service provider institutions being unable to connect childcare workers to households applying for childcare services."

The Ministry of Gender Equality and Family also explained that the low execution rate of local government budgets was due to unresolved issues in childcare supply. Choi Seong-ji, Director of Family Policy at the Ministry, stated, "The actual execution rate was low because childcare was not sufficiently supplied," adding, "Therefore, various institutional improvements are being made this year." A working-level official explained, "Until last year, conditions such as childcare allowances did not significantly change, but the budget increased greatly in anticipation of rising demand, which led to unused funds," and added, "We are encouraging each local government to expand projects and actively execute their budgets."

In September, the Ministry of Gender Equality and Family announced that starting next year, the government support target for childcare service usage fees will be expanded from 'households with income below 150% of the median income' to 'households below 200% of the median income.' Additionally, the number of government-supported households will increase from 110,000 this year to 120,000 next year, and the hourly childcare allowance will be raised by 4.7% next year as part of treatment improvement measures. However, it remains difficult to bridge the gap between childcare demand and supply. Assemblyman Kim Han-kyu pointed out, "Despite various criticisms regarding the training of childcare workers during the annual Gender Equality and Family Committee audits, there is no sign of improvement," and added, "If it is not a budget or manpower issue, it can only be seen as a problem of the Ministry’s capacity."

Heo Min-sook, a feminist scholar and legislative researcher at the National Assembly Research Service, also advised, "Although the Ministry of Gender Equality and Family says it is increasing the budget, in reality, the number of childcare workers is not increasing," and suggested, "Direct incentives that guarantee the basic income of childcare workers to retain them should be expanded."