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Parties urged to form ‘consultative body on welfare budget’

Parties urged to form ‘consultative body on welfare budget’

Posted November. 13, 2014 04:11,   

한국어

Woo Yoon-geun, floor leader of the main opposition New Politics Alliance for Democracy, proposed to the ruling Saenuri Party on Wednesday to “form a 4 + 4 consultative body to secure budget for obligatory welfare programs.” The suggestion calls for the establishment of a consultative body comprised of policy committee chairs of the two parties, and secretaries of the parliamentary Strategy and Finance Committee, Health and Welfare Committee, and Education, Culture, Sports and Tourism Committee, and subsequent adjustment of welfare budget plans for next year. The suggestion seems to entail a hidden agenda, because it is meant to include free school meals in the obligatory welfare programs under the condition that all free welfare services under controversy should be implemented as they are. Apparently for this reason, the Saenuri Party has expressed objection.

The central government, the rival parties, metropolitan and provincial governments, and education offices have raised their own unique voices respectively over budget plans on free welfare programs. If an agreement on the implementation of budgets for childrearing subsidies and free school meals is not made among the central government, provincial and metropolitan governments, and education offices, default of welfare budget could become a reality and the entire country could be forced into "welfare conflict" next year. Whether it would be the format of 4 + 4 consultative body or other structures, the ruling and opposition parties need to establish a separate consultative body and find ways to resolve the problem.

Floor leader Woo claimed that the government can possibly cut and adjust more than 5 trillion won (4.56 billion U.S. dollars) from next year’s budget. But the precondition for this, he said, "Without causing burden on government projects, projects whose progress is slow amount to 6.7 trillion won (6.12 billion dollars) in value, excessively allocated budgets amount to 25 trillion won (22.8 billion dollars), and new projects that are not essential are worth 500 billion won (456 million dollars).” The opposition party’s claim can be somewhat exaggerated, but there would be budget overstated figures under the prediction that they would be slashed by the National Assembly. The so-called "memo budgets" worth about 500 billion won (456 million dollars), which are set aside every year for pork-barreling projects for lawmakers’ constituencies, should be eradicated. Also, budgets worth more than 4 trillion won (3.65 billion dollars) that are deferred and unused every year by the metropolitan and provincial offices of education nationwide should be closely examined.

Amid the ruling and opposition parties racing to provide more free welfare services, the government has spent a total of 38.54 trillion won (35.1 billion dollars) on childrearing subsidies, free school meals, expansion of the basic pension, Hope Ladder scholarships, and halved tuition over the past four years. If all of President Park Geun-hye’s election pledges for welfare programs are implemented, the central government’s welfare spending will amount to an estimated 124.2 trillion won (113 billion dollars) in 2015 alone. Korea currently has a fiscal structure in which tax income is falling amid a slowing economy but welfare expenditures are snowballing, and if left unchecked, the state finance will end up collapsing, and welfare programs will be no longer sustainable.

Ultimately, massive restructuring of free welfare programs is required so that benefits are provided preferably to those in desperate need of free welfare, within the viable scope of state finances, and can be gradually expanded to help more people. However, given that this measure cannot be immediately applied from next year’s budget, the government should restructure welfare programs and adjust budget figures as a stopgap measure to avert an imminent crisis.