Park slams welfare moves in Seoul, Seongnam

President Park Geun-hye rebuked local governments for promising welfare benefits and said politicians should avoid such populist policies if they don’t consult with the central government first.

Park presided over a Social Security Committee meeting for the first time Wednesday at the Blue House and took aim at a series of welfare benefits unveiled in recent months by the mayors of Seoul and Seongnam, both from the opposition New Politics Alliance for Democracy. The Saenuri Party has criticized the welfare programs as populist and wasteful.

One of the most controversial promises was financial aid for jobless people aged 19 to 24 totaling up to 1 million won ($865) a year in the name of “youth dividends,” a brainchild of Seongnam Mayor Lee Jae-myung. It is estimated to cost nearly 60 billion won a year to implement.

Following suit, Seoul Mayor Park Won-soon announced earlier this month that his city government would give aid of 500,000 won a month for each jobless adult aged 19 to 29 in the city for six months. The recipient has to be from a family that makes less than 60 percent of the average household income. The city government said it would select 3,000 people eligible to receive benefits starting from the second half of 2016. A total of 50 billion won is estimated to be needed to carry out the pledge over a five-year period from 2016 through 2020.

“The central and local governments should actively cooperate in order to create jobs for young people and seek ways to nurture their qualifications in the job market,” President Park said. “While doing that, we need to be cautious about populist campaigns that have been laid out [by local governments] without any prior consultations with the central government.”

It is possible that the central government will curb its subsidies if Mayors Park and Lee decide to go ahead with their welfare plans.

Other welfare policies that have been in hot water include Mayor Lee’s drive to set up free postnatal care centers, which is expected to cost 3 billion won a year, and provide free school uniforms for secondary school students, forecast to cost 2.5 billion won a year.

Seongnam received 13.6 billion won from the central government in local subsidies, which could be slashed if Mayor Lee pushes ahead with his welfare plans.

In response to President Park’s apparent warning, Seongnam’s government reaffirmed its commitment to the pledges. “As the city has already secured welfare budgets for the next year, we plan to implement welfare projects that we promised,” said Kim Nam-jun, the city government spokesman.

On the possibility of the central government revising the law to block local governments from overgenerous welfare benefits, Kim said the city government would decide what to do about it once the law is revised.

BY KANG JIN-KYU [kang.jinkyu@joongang.co.kr]