Blue House defends phone bill subsidy despite broad criticism

Politics

Published: 14 Sep. 2020, 17:37

Blue House defends phone bill subsidy despite broad criticism

A bicyclist moves in front of a smartphone store on Thursday. President Moon Jae-in said last week that the government will pay a 20,000 won ($17) subsidy to the smartphone users as a 'token of affection' to the people who are struggling with the coronavirus pandemic. [YONHAP]

A top presidential aide on Monday defended the government’s controversial plan to spend 928 billion won ($784 million) to fund one-time subsidies for phone bills, an initiative that has prompted criticism by both the opposition parties and the public.

“If a family has three or four people who are older than middle school students, they can together save 60,000 won or 80,000 won on their telecommunication bills,” said Presidential Senior Secretary for Economic Affairs Lee Ho-seung said in an interview with CBS Radio on Monday. “Is this meaningless, useless support? I don’t think so.”

The government’s proposal would provide a 20,000-won subsidy for smartphone bills to anyone above the age of 13. The money would go directly to the phone companies.

Chairman Lee Nak-yon of the ruling Democratic Party (DP) made a proposal to include the subsidy in the fourth supplementary budget during the party leaders’ meeting with President Moon Jae-in on Wednesday. Moon agreed to push it forward, saying on Thursday that it is the government's "token of affection" to people who are struggling amid the coronavirus pandemic.

When the government, Blue House and the DP agreed earlier this month to formulate the fourth supplementary budget, worth up to 8 trillion won, they said it will be 100 percent financed by issuing state bonds.

The main opposition People Power Party (PPP) has adamantly opposed the smartphone bill subsidy, questioning its effectiveness.

“This is insane,” Rep. Joo Ho-young, floor leader of the PPP said Friday. “We will make sure to fix this during the budget review at the National Assembly.”

The initiative also got a cold reception from the public. In a poll conducted by the Realmeter on Friday and published Monday, 58.2 percent of respondents said the plan is “wrong,” and 37.8 percent said the plan is “good.” The poll has a 95 percent confidence level, with a margin of error of plus or minus 4.4 percentage points.

“This is a classic example of indiscriminate pork barrel spending,” Rep. Choo Kyung-ho of the PPP said Monday in an interview with MBC Radio. “Ahead of the Chuseok holiday, the government abruptly decided to spend nearly 1 trillion won of tax money to support phone bills.”

Choo has also been critical of the government’s demand to pass a fourth supplementary budget bill before the Chuseok holiday, which falls on Oct. 1 this year. Scrapping the phone bill subsidy plan is a precondition for opposition lawmakers’ cooperation on that budget, he said.

“Normally it takes two to three weeks for the lawmakers to deliberate on a supplementary budget bill,” Choo, who once served as the vice minister of finance, said. “The administration and the ruling party want to spend nearly 8 trillion won by creating state debt, and we must never hastily approve it. The National Assembly is not the administration’s subcontractor that has to follow its schedule.”

“Instead of spending money on telephone bills, the government should spend the money to offer free flu vaccines to more people to bolster coronavirus preventive measures,” Choo said. This year, flu vaccines are offered free to those who are 18 or younger, and who are 62 or older.

Another PPP lawmaker told the JoongAng Ilbo that the government plans to spend about 1 billion won to operate a temporary support center to give away the phone bill subsidy, in addition to the subsidies themselves.

According to Rep. Her Eon-a, the Ministry of Science and ICT originally asked for a 928 billion won budget to pay a one-off 20,000 won payment to 4.64 million people. In addition, it asked for another 946 million won to operate a support center.

According to the plan, a temporary support center would be operated for two months and would employ 44 people, collectively making more than 275 million won.

Another 109 million won has been requested to hire other support staff, and the ministry asked for 130 million won to rent office spaces. It asked for another 218 million won for public affairs of the program.

“The government said it will spend nearly 1 trillion won in tax money for a phone bill subsidy, and then it wants to spend another 1 billion won of tax money to operate that project,” she said. “The government is issuing bonds to raise funds. Is it acceptable to recklessly spend money?”

Top politicians from the ruling party also questioned the effectiveness of the phone bill subsidy.

Gyeonggi Gov. Lee Jae-myung said last week that it is regretful that the subsidy will have no effect in boosting sales for self-employed people who operate small businesses.

“The money will go straight to telecom companies,” he said. “But it is inappropriate for me to challenge the party’s decision.”

South Gyeongsang Gov. Kim Kyoung-soo proposed expanding free Wi-Fi networks, instead.

In the CBS interview on Monday, Senior Secretary Lee dismissed their opinions.

“When we pay the phone bills, the people will end up with the saved money in their bank accounts,” Lee said. “This is the most effective way to give away the funds.”

Lee also said the phone payments are important amid the pandemic because they serve a critical role for the country's social distancing campaign, allowing students to study online and employees to work from home.

Lee said the government will listen to the opinions of the National Assembly, but he made clear that the administration has no intention to back down.

“We have made this decision after serious discussions,” he said.

BY SER MYO-JA [ser.myoja@joongang.co.kr]