Seongnam’s voucher policy spurs criticism

The Seongnam city government’s decision to distribute gift vouchers to its 24-year-old residents in the name of youth dividends has pitted the local government against the central government.

The handouts are the brainchild of Seongnam Mayor Lee Jae-myung, who made good on his promise to hand out gift vouchers worth 500,000 won ($416) to the city’s 24-year-old inhabitants who have resided there for more than three years.

The Seongnam city government plans to distribute the dividends on four separate occasions this year.

The project is valued at 11.3 billion won.

The local government handed out gift cards worth 125,000 won on Wednesday in the first phase of the initiative’s implementation.

The city vouchers may be used for purchases at traditional street markets and locally owned or independent stores as well as at gas stations and public parking lots.

Controversy over the policy flared, however, after it was discovered that some recipients had put their coupons up for sale in return for between 70,000 and 80,000 won in cash on an online trading site for used items.

In response, the city government in Gyeonggi announced it would distribute electronic gift cards that could only be used in the city to prevent abuse.

Lee’s welfare pledge has drawn strong opposition from the central government and the ruling Saenuri Party, which called the plan populist and wasteful, though the mayor has argued that the campaign will alleviate the burden on the young people looking for work amid a saturated job market and reinvigorate the local economy.

Lee’s campaigns to set up free infant care centers and provide free school uniforms for secondary school students, which would together require 5.5 billion won annually, have also been criticized by the central government as exorbitant.

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