Government Claims 70% Disaster Relief Payment... Expansion of 'Universal Payment' Expected Nationwide

Advocacy for Nationwide Emergency Disaster Relief Fund Payment
Ministry of Economy and Finance: "70% Income Threshold, Considering Urgency, Efficiency, Equity, and Fiscal Capacity"

[Asia Economy Reporter Jang Sehee] As the government has submitted the supplementary budget (supplementary budget) for emergency disaster relief funds to the National Assembly, attention is focused on whether the scope of emergency disaster relief fund recipients will be expanded. With the Democratic Party of Korea's landslide victory in the general election, the possibility of gaining momentum for the originally proposed 100% payment of emergency disaster relief funds has increased.

On the 16th, the government submitted a one-point supplementary budget plan for emergency disaster relief funds to the National Assembly. According to political circles, both ruling and opposition parties voiced a unified stance on providing emergency disaster relief funds to all citizens during the general election process. Since both parties agree on 100% payment, there are voices suggesting that the government's position will change from 70% to 100%. In particular, as the Democratic Party, which won a landslide victory in the election, insists on the policy of providing funds to all citizens, negotiations are expected to proceed accordingly. Democratic Party lawmaker Kang Hoon-sik stated on the day, "The party's position on 100% payment of disaster relief funds has not changed."

If the Democratic Party's proposal is adopted to provide up to 1 million KRW per household, it will cost 13 trillion KRW. On the other hand, the United Future Party claims that a budget of 25 trillion KRW is needed to provide 500,000 KRW per person.

However, since the government set the scale of recipients comprehensively considering the urgency of disaster relief fund payments and fiscal capacity, there is also a high possibility that the payment will proceed as originally planned.

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, said at the briefing on the 2nd supplementary budget plan, "The 70% income support standard set by the government is a matter decided after much discussion, comprehensively considering urgency, efficiency, equity, and fiscal capacity," adding, "The government will maintain its original position so that the 70% standard set by the government can be upheld in the National Assembly." He continued, "We earnestly request the National Assembly to start deliberations as soon as possible for the prompt approval of the supplementary budget."

In fact, to secure future fiscal capacity, the government prepared the supplementary budget entirely through expenditure restructuring without issuing deficit bonds during this supplementary budget formulation process. Currently, the national debt stands at 815.5 trillion KRW, and the national debt ratio reaches 41.2%.

As the COVID-19 situation prolongs, discussions on the '3rd and 4th supplementary budgets' to minimize economic damage are also emerging.

Ahn Il-hwan, Director of the Budget Office at the Ministry of Economy and Finance, said, "It is difficult to judge whether a 3rd supplementary budget is absolutely necessary for any measures to be prepared," adding, "While preparing measures, various resources will be used to respond, and if necessary, the government will also consider providing additional fiscal support again."

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