The Korea Rural Community Corporation has decided to abolish the child allowance that it has been providing since last year and to recover the amounts already paid. This measure follows a finding in the Ministry of Economy and Finance's management evaluation that the corporation violated budget management regulations.

According to Seo Samseok, a member of the Democratic Party of Korea representing Yeongam, Muan, and Shinan in South Jeolla Province, the Korea Rural Community Corporation will recover a total of 2,201,687,000 won in child allowances paid since January last year. A total of 1,898 employees are subject to recovery, with each required to return between 120,000 and 3,600,000 won.

Korea Rural Community Corporation, pointed out for budget management regulation violations,
abolishes child allowance... recovers 2.2 billion won
1,898 employees subject to recovery, from 120,000 won to 3.6 million won

The Korea Rural Community Corporation began providing the child allowance after the system was revised in December 2023. At that time, the system was improved to allow public institutions to provide child allowances and childbirth bonuses at the same level as current civil servants, regardless of wage increase rates. The labor union proposed the introduction of the child allowance to management, and both sides agreed to implement it at the labor-management council in the fourth quarter of 2023. The corporation introduced and began paying the child allowance in January 2024 after resolutions by the management committee and the board of directors.

Abolished after one year since introduction in January 2024
"A measure conscious of management evaluation... distorting the original intent"

The child allowance became an issue in April 2024, when the Ministry of Economy and Finance's management evaluation pointed out that the corporation had violated budget management regulations, specifically the rule that allowances converted to base salary or base annual salary cannot be newly established again. After consulting with the ministry, the corporation concluded that there was a problem with its budget management, decided to abolish the child allowance, and began recovering the related payments. In connection with health insurance premium calculations, 2,751 employees were notified to pay an additional 472,740,000 won, while 2,976 employees were refunded 395,850,000 won.

It is reported that additional payments or refunds were notified due to differences between the amounts assessed by the National Health Insurance Service and the actual amounts paid by employees, caused by changes in eligibility such as leave of absence or overseas assignments, and changes in monthly salary. The corporation stated to Seo Samseok's office that after completing the recovery of the child allowance and insurance premiums, it would conduct an internal investigation, request an audit, and establish measures to prevent recurrence by investigating whether there was negligence.

Seo Samseok said, "Although the child allowance is an extension of the government's policy to address the low birth rate, recovering allowances that employees have already received out of consideration for management evaluations distorts the original intent of the policy. Through the National Assembly audit, we will examine the actual status of child allowance payments at public institutions under the jurisdiction of the Agriculture, Food, Rural Affairs, Oceans and Fisheries Committee and improve the system to prevent cases like that of the Korea Rural Community Corporation from recurring."