Lee Jae-myung's Determination: "100,000 Won Disaster Basic Income Per Person for 13.26 Million Gyeonggi Residents"

Gyeonggi Province Governor Lee Jae-myung (center) is announcing the plan to provide Gyeonggi Province-type disaster basic income at the Gyeonggi Provincial Government briefing room, together with Song Han-jun, Chairman of the Gyeonggi Provincial Council (left), and Yeom Jong-hyun, Leader of the Democratic Party of Korea in the Gyeonggi Provincial Council.

[Asia Economy (Suwon) = Reporter Lee Young-gyu] Lee Jae-myung, Governor of Gyeonggi Province, has decided to provide 'disaster basic income' of 100,000 KRW per person to 13.26 million residents of Gyeonggi Province as part of support measures due to the 'Novel Coronavirus Infection' (COVID-19). The payment period is from April 1 for three months.

There are already remarks that this is a resolute administration that only Lee Jae-myung could carry out. Some local governments, such as Jeonju City, have decided to provide public support in the form of disaster basic income only to households meeting certain criteria. However, Gyeonggi Province is the first to introduce disaster basic income for all residents.

Governor Lee has continuously proposed the introduction of disaster basic income to the government, stating that to revitalize the local economy and households suffering from COVID-19, it is necessary to create a virtuous cycle of economic revitalization within the region by providing money (local currency) directly to individuals rather than tax reduction policies such as corporate tax cuts.

On the 19th, Governor Lee also earnestly requested President Moon Jae-in through his Facebook, saying, "I support the President who is wisely overcoming this difficult crisis," and "Please actively consider the introduction of disaster basic income."

Governor Lee holds a strong belief that there is no better policy than disaster basic income in catastrophic economic crisis situations. He also believes that providing basic income selectively to low-income and poor people, excluding some wealthy individuals or high taxpayers, may cause various side effects such as stigma of poverty, tax resistance, and double discrimination controversies.

Furthermore, Governor Lee sees disaster basic income as the most suitable policy for overcoming temporary economic crises, with significant effects in preventing waste of time and costs related to selective payment investigations.

He explained, "World-renowned scholars, including Nobel Prize-winning economist Paul Krugman, argue that disaster basic income is the optimal policy alternative in disaster situations," and "Countries currently struggling with COVID-19, such as the United States, Hong Kong, and Singapore, are actively considering or implementing disaster basic income."

According to this announcement, Gyeonggi Province will provide 100,000 KRW per resident starting next month, amounting to 400,000 KRW for a family of four as disaster basic income.

The eligibility for disaster basic income is for those who are residents of Gyeonggi Province from 24:00 on March 23, 2020, until the application date. According to the resident registration population statistics announced by the Ministry of the Interior and Safety as of the end of February 2020, the population of Gyeonggi Province is 13,265,377.

The province allows full application on behalf of all household members by verifying identity at the Eup, Myeon, and Dong administrative welfare centers (a power of attorney is required for adults). However, the payment is in local currency, which expires after three months. Governor Lee stated, "This decision was made to ensure that the local currency provided in a short period is fully consumed, resulting in dual effects of household support and increased sales for local businesses and self-employed individuals."

The required funds of 1.3642 trillion KRW come from 340.5 billion KRW from the Disaster Management Fund, 273.7 billion KRW from the Disaster Relief Fund, and 700 billion KRW from the Regional Development Fund created by sales of automobile purchase bonds. The shortfall was covered by cutting 50 billion KRW from the 100 billion KRW ultra-low credit loan project budget announced last week, considering the reduction of support blind spots.

Governor Lee said, "We considered various support measures for Gyeonggi residents, self-employed, and businesses in crisis, but there were many conflicts due to insufficient funds," and "From the perspective of Gyeonggi Province, which has no tax decision authority and limited local bond issuance rights, it was difficult to create a satisfactory alternative that meets the expectations of all residents."

He added, "Thanks to the government's consideration, we were able to utilize the Disaster Management Fund and Disaster Relief Fund, but even gathering all these funds made it difficult to exceed 50,000 KRW per resident, so we mobilized all available resources," and "Although the amount is small and one-time, I hope that the Gyeonggi Province-type disaster basic income will serve as a starting point for national-level basic income discussions and become a new policy suitable for the new era."

Meanwhile, according to the economic ripple effects calculated by the Gyeonggi Research Institute applying the Bank of Korea's input-output table (2017 extended table), when disaster basic income of 100,000 KRW per person is implemented, the production inducement effect is 1.1235 trillion KRW, the value-added inducement effect is 622.3 billion KRW, and the employment inducement effect is 562.9 billion KRW.

This content was produced with the assistance of AI translation services.