Half-baked measures for birthrates

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Half-baked measures for birthrates

The government unveiled the third stage of its plan to address the structural problems created by the low birth rate and rapidly aging society.

Under the five-year plan that takes effect in 2016, loan limits for newlyweds’ rent would be raised from 100 million won ($88,261) to 120 million won. The younger the couple, the bigger the preferential points they will receive when applying for public rental homes. The government trotted out rent incentives for young people believing birth rates are not improving because they are shying away from or delaying marriage. The age eligible to receive national pension payouts will be moderated to 61 to meet with the legal retirement age of 60. The government will also mull pushing back the retirement age to 65.

Through the new incentives, the government hopes to raise the birth rate to 1.5 from the current 1.2 by 2020. The new measures follow up on two earlier-stage plans that were designed to set the legal and systemic grounds to better respond to the demographic shifts and increase childcare benefits. Birth rates improved by little, although the government has spent 153 trillion won in two earlier measures. The third was more oriented towards promoting marriage.

But experts are skeptical of meaningful outcomes from the new measures. The young are pushing back against marriage because they are insecure about income due to a scarcity of jobs. Measures to create jobs for young people have been bundled and recycled from existing policies and lack any refreshing ideas. The government also included plans to draw a foreign workforce to address the thinning work-age population. The measures raise reliability questions by including immigration plans in a five-year outline.

Home incentives for newlyweds also could hardly help to bring about any real effect. Young people won’t suddenly rush to get married just because the rent loan cap was lifted by 20 million won and the loan qualification period was tweaked to three months before marriage from the current two.

A five-year outline cannot cope with structural problems. It must be in a longer-term basis, panning out for at least two decades so that the measures are uninterrupted by the changes in the ruling power. Korea, like Japan and France, must proclaim low birth problem as the utmost state priority and take more aggressive and farsighted actions.

JoongAng Ilbo, Oct. 19, Page 34

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