Another Nationwide Disaster Relief Fund? ... What Do You Think About the Ruling Party Mentioning the 2nd Supplementary Budget?

With Yoon Ho-jung "Urgent supplementary budget including nationwide disaster relief fund"
Opposition "Populist policy aimed at votes before election"
Experts "Citizens may not welcome disaster relief fund"

Yun Ho-jung, floor leader of the Democratic Party of Korea (second from the left), is speaking at the floor strategy meeting held at the National Assembly in Yeouido, Seoul, on the 1st.
[Photo by Yonhap News]

[Asia Economy Reporter Heo Midam] The ruling party is raising voices to formulate a second supplementary budget bill (supplementary budget) including nationwide disaster relief funds. The plan is to promote economic revitalization in line with the full-scale start of COVID-19 vaccinations ahead of the vacation season. However, some voices oppose the nationwide disaster relief funds, pointing out worsening fiscal soundness. In particular, criticism has been raised that the ruling party might be engaging in 'populist money distribution' ahead of next year's presidential election. Experts predict that citizens will not unconditionally welcome the disaster relief funds.

On the 1st, Yoon Hojung, the floor leader of the Democratic Party, stated at the floor strategy meeting, "It is urgent to formulate and pass a supplementary budget bill that includes inclusive easing policies and nationwide disaster relief to support the affected groups and accommodative monetary policies," he said.

This is the third time Floor Leader Yoon has emphasized the need for a supplementary budget. Earlier, on the 28th of last month, at the party's supreme council meeting, he first mentioned the need for a second supplementary budget, saying, "If the second supplementary budget is prepared in line with the recovery of economic activities due to COVID-19 vaccinations, it will serve as a special lubricant for the Korean economy." Then, on the 31st of last month, he formalized the formulation of the supplementary budget, saying, "We plan to devise additional fiscal measures, including a supplementary budget, to inject warmth into the contracted real economy this summer."

Although the specific scale of the supplementary budget has not yet been decided, since the second supplementary budget is focused on universal payments rather than selective payments, it is likely to be a 'super supplementary budget.' Also, if the funds needed for loss compensation for self-employed people currently under discussion in the National Assembly are included, the total supplementary budget is estimated to reach up to 30 trillion won. The largest supplementary budget to date was 35.1 trillion won during the third supplementary budget last year.

The ruling party's proposal for nationwide disaster relief funds has sparked mixed opinions among netizens. Photo by Portal Site 'Daum' Screenshot

However, voices concerned about national debt continue regarding the ruling party's disaster relief payment plan. Kim (31), an office worker, said, "Who asked for disaster relief funds? I don't understand why they keep trying to give money that no one wants. All of this eventually becomes debt," and criticized, "It feels like the people's taxes are being used arbitrarily according to the ruling party's preferences."

Netizens also expressed critical reactions such as "It's too much no matter how you look at it. Why do they keep increasing the people's taxes?", "It seems like 'election support money' rather than nationwide disaster relief funds," "Who will pay off all that debt?", "It's our taxes anyway. I don't understand why they brag about using taxes," and "Isn't this money being distributed early because of next year's election?"

On the other hand, some support the disaster relief funds, saying they help economic revitalization. One netizen said, "It's welcome news after a long time. If people receive the funds, they will spend the money, so the sales of small business owners will also increase accordingly," and added, "I don't understand why people criticize when everyone would spend the funds well."

A rental inquiry notice is posted at a store in Jung-gu, Seoul. The photo is unrelated to specific expressions in the article. [Image source=Yonhap News]

The problem is the funding. After the first supplementary budget this year, the national debt reached 965.9 trillion won, approaching 1,000 trillion won, and the national debt ratio to GDP rose to 48.2%.

In 2017, the first year of the Moon Jae-in administration, the national debt ratio was only 36%, but due to four supplementary budgets last year, the largest expansionary fiscal policy ever this year, and the first supplementary budget, it soared to 48.2%. In this regard, the international credit rating agency Moody's warned that "South Korea's national debt is historically high."

Meanwhile, opinions have emerged that the ruling party's mention of nationwide disaster relief funds is related to party approval ratings and the presidential election. Many analyses suggested that the nationwide disaster relief fund issue worked in favor of the Democratic Party in last year's 21st general election.

The opposition party also pointed out this aspect, calling the nationwide disaster relief funds a 'populist policy.' Kang Ming-guk, the floor spokesperson for the People Power Party, said in a statement, "The government and the Democratic Party are ignoring people's livelihoods by not spending money where it is truly needed. While delaying the passage of the loss compensation law due to lack of funds, why do they bring up 'disaster relief funds' and 'super supplementary budgets' that require huge finances first?" He added, "It can only be suspected as a 'populist policy' aimed at winning votes before the election."

Critical opinions also came from the Justice Party. Lee Eun-joo, the floor spokesperson for the Justice Party, said in a briefing, "The Democratic Party's stance of talking about nationwide disaster relief funds while neglecting the loss compensation law is not only difficult to understand the true intention but also hard to accept logically," and criticized, "It is very inappropriate to talk about nationwide disaster relief funds without properly handling loss compensation for small business owners."

Experts expressed concerns about national debt caused by repeatedly distributed disaster relief funds. Political commentator Lee Jong-hoon pointed out, "National debt is rapidly increasing due to disaster relief funds. As public concern grows accordingly, citizens will not unconditionally welcome the disaster relief funds." He added, "Especially since the ruling party repeatedly proposes such plans, people might think of them as a kind of 'vote-buying strategy.'"

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