Review of January Payment for 3rd Disaster Relief Fund...Easing Pain for Affected Groups

The Democratic Party conveys opinion on the need for 'early execution' to the government

Due to the resurgence of the novel coronavirus infection (COVID-19), the Seoul metropolitan area, including Seoul and Gyeonggi, which are densely populated with small business owners, continues to experience a recession. On the 21st, the area around Cheonggyecheon Tool Market in Jung-gu, Seoul, showed a deserted appearance. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Moon Chaeseok] The government is pushing to provide the third round of disaster relief funds next month to respond to the damages caused by the resurgence of COVID-19.

On the 13th, according to the ruling Democratic Party and the government, the ruling party and government are considering advancing the timing of the third disaster relief fund payment, originally planned before the Lunar New Year holiday in February, to next month.

After the next year's budget, which includes 3 trillion won for the third disaster relief fund, was finalized by the National Assembly, the government is preparing detailed plans regarding the recipients, amounts, and timing of the payments.

Since the budget was confirmed on the 2nd, social distancing measures have been raised to level 2.5 in the metropolitan area and level 2 in non-metropolitan areas, increasing the damage, indicating that the situation is being continuously monitored.

Within the ruling party, there is a consensus that the payment timing should be brought forward as much as possible, and it is known that this opinion has been conveyed to the government.

A key Democratic Party official said, "Since social distancing in the metropolitan area has risen to level 2.5 and the situation is not good, support should be expedited and implemented early from next month wherever possible," adding, "We have conveyed the practical details to the government."

Accordingly, the ruling party and government are expected to enter detailed discussions for payment next month.

The spread of COVID-19 is not subsiding easily, deepening the suffering of affected groups.

Since the 24th of last month, with the implementation of level 2 social distancing in the metropolitan area, restaurants, karaoke rooms, indoor sports facilities, and others have faced operational restrictions.

From the 6th, with the rise to level 2.5, karaoke rooms, indoor sports facilities, academies, and others were banned from gathering, and movie theaters, PC rooms, study rooms, marts, and shops also faced operational restrictions.

Small business owners and self-employed individuals, who were already significantly impacted by operational restrictions in August and September, are facing difficulties again.

According to Korea Credit Data, the average sales of small business establishments nationwide in the first week of December dropped to 0.77 compared to the same period last year, which is set as 1.

Sales of small businesses in the Seoul area fell to about 69% compared to the same period last year.

Especially, voices are rising that the damage is greater than during the second wave because the year-end peak season was missed.

Even if the timing of the third disaster relief fund payment is advanced, the scale and recipients are expected to be set as originally planned by the government and the National Assembly.

The 3 trillion won reflected in next year's budget is expected to be focused on supporting self-employed and small business owners who suffered business losses due to the raised social distancing levels.

Second Vice Minister of Strategy and Finance Ahn Il-hwan said, "During the second disaster relief fund, employment retention subsidies and elementary school childcare were also largely included, but this time (the third fund) is understood to focus more on small business owners affected by COVID-19," he said.

The second disaster relief fund provided 2 million won to businesses where operations were banned and 1 million won to businesses with restricted operations; similar criteria are likely to be applied for the third round.

However, as the spread of COVID-19 intensifies and the possibility of raising social distancing to level 3 arises, it is difficult to predict how much the damage will increase, leaving room for expanding the recipients later to include vulnerable employment groups and low-income households.

The government has set the payment scale at "3 trillion won + α".

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