Overhauling welfare systems

The dreary dispute over welfare programs seems never-ending. Prime Minister Lee Wan-koo on Wednesday said the government will reexamine welfare programs for ways to spend more efficiently. On the same day, free lunches were handed out by parents outside an elementary school in Jinju, South Gyeongsang, to protest the provincial governor’s decision to end free school lunches citing lack of funds. Meanwhile, liberal education chiefs from the capital region held a joint press conference demanding the government wholly finance welfare programs, starting with preschool. The power game over universal welfare goes on.

The government finally has put its foot down. It plans to save 3 trillion won ($2.74 billion) in welfare spending by tightening eligibility criteria, watching for irregularities and realigning redundant and overlapping businesses. Korea has ranked first among OECD members in percentage growth of welfare spending over the past decade. Welfare spending ballooned to 116 trillion won this year from 50 trillion won in 2005. Even with spending 30.8 percent of the government budget on welfare, people remain dissatisfied.

Universal free child care and school meals are the biggest fixed expenditures. Efficient management won’t end the dispute over financing. It requires an entirely new framework. There has never been a long-term plan for the country’s welfare system. It was just amended and expanded in an arbitrary and impromptu manner. An entirely subsidized child care system is not found even in advanced welfare states like Sweden.

Welfare expenditures will grow 6.7 percent annually even without factoring in more demand due to the low birth rate and aging population. Yet despite the fast growth, the amount Korea spends on welfare is the lowest among OECD countries. Social welfare must increase, but in well-planned and efficient ways. The current system needs a makeover. Some programs must go, and others should be scaled down or merged. Welfare disputes won’t go away with makeshift measures. They will resurface and could explode during the parliamentary election next year and presidential election the following year. Politicians should stop wrangling in vague ideological language. The legislature, presidential office, government and experts should form a consultative body and come up with a long-term outline. If necessary, they must persuade the people and seek a tax increase. If the outline and direction are well-planned and clearly communicated, people will go along.

JoongAng Ilbo, April 4, Page 34