When Prime Minister Kim Hwang-shik took office last October, it wasn’t really the confirmation hearings that landed him in hot water.
It was his comment about how the subway shouldn’t be free to citizens who are over 65 years old, as it is now. His comment instantly drew a public backlash, and he quickly expressed regret for making it.
Some political insiders believed that Kim, a former chief of the Board of Audit and Inspection, was speaking from the perspective of one who knew the subway was running up a deficit.
But Korea currently lacks a social safety net; there is no broad U.S.-type social security benefit. Thus, a free subway ride for citizens 65 years and older provides a way for most of these people who have retired to get around and be active. Thus, the idea of some free public service, albeit small, is naturally receptive with the majority of the populace.
In the political realm, the main opposition Democratic Party (DP) is construed as having won big in last year’s June 2 local elections when it came out with a proposal to provide free lunches for elementary and middle school children.
This year, the DP has come up with a package of providing not only free lunches at schools, but the proposal to cut the amount patients have to pay in medical fees for treatment and hospitalization down to 10 percent from the current 40 percent and provide free childcare for children up to 5 years old.
It also proposes halving college tuition, with assistance from the government. Sohn Hak-kyu, DP chairman has said that “the ultimate goal of welfare is that (people) are treated equally and with dignity.”
The governing Grand National Party (GNP) has been criticizing the DP for raising the specter of populism. But the GNP has put forth welfare benefit proposals, too.
The party’s frontrunner for its presidential candidacy, former party chairwoman Park Geun-hye, has declared that the welfare policy will be her bread-and-butter issue for the next presidential election in December 2012. “I’d like to propose a preemptive, sustainable and integrated welfare system that can produce tangible results for the people,” Park said in a speech.
GNP Chairman Ahn Sang-soo has also vouched for expanding welfare benefits to cover about 70 percent (excluding the top 30 percent of high-income) of households.
Thus, the need for expansion of welfare benefits is a common denominator in Korea. Among the member countries of the Organization for Economic Cooperation and Development (OECD), Korea’s welfare level was among the lowest.
Korea spent 7.5 percent on public welfare spending in comparison to its gross domestic product in 2009. That figure comes to less than half of the average spending on public welfare, or 19.3 percent of other OECD nations. The difference seems a matter of scope for the two major parties. Of course, we cannot ignore the political factor in here. The DP is expected to seek a policy-based coalition along with minor parties.
But as the old but true saying goes, there is no such thing as a free lunch. The DP estimates that about 8.1 trillion won will be needed to provide free medical care; 4.1 trillion won for free child care; and 1 trillion won for free school lunches and 3.2 trillion won for college tuition assistance.
The government and the governing party beg to differ, saying that the DP figures are too modest for its grand scheme.
Individual Koreans might feel that they are already paying too much tax, but increased welfare benefits invariably will mean a bigger tax burden. As Korean society rapidly ages, the burden may well be heavier on those now in the work force and those who honestly report their earnings.
Let’s just hope that all the heated debate about expanding welfare benefits leads to all taxpayers equally and with dignity doing their part in the process.
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