Assembly approves extra budget, Moon vows quick handout

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Assembly approves extra budget, Moon vows quick handout

The National Assembly passes a 16.9-trillion-won ($14.2 billion) supplementary budget on Monday.  [YONHAP]

The National Assembly passes a 16.9-trillion-won ($14.2 billion) supplementary budget on Monday. [YONHAP]

The Moon Jae-in administration vowed Tuesday to quickly spend the supplementary budget, approved by the National Assembly Monday night, to fund more Covid-19 response measures and assist small businesses hit by the social distancing restrictions.
"It is belated, but it's fortunate that the extra budget was passed," President Moon said at the cabinet meeting. "Now, it's time for the government [to do its part]. We must spend the budget as quickly as possible so that small business operators and self-employed people don't have to wait any longer."
The National Assembly approved Monday night a 16.9-trillion-won ($14.2 billion) budget aimed at giving financial support to small businesses hit by the government-imposed restrictions and funding additional Covid-19 response measures.
The latest supplementary budget is the Moon administration's 10th such program since he took office in 2017. The amount approved was 2.9 trillion won more than the government's proposal unveiled last month.
During the Covid-19 outbreak, the Moon government spent four supplementary budgets in 2020 and two in 2021.
According to the bill, small businesses and self-employed people, artists, freelance workers and taxi and bus drivers will receive financial support. Of the budget, 13.5 trillion won is earmarked for assisting small businesses and other vulnerable populations affected by restrictions.
The payment will start Wednesday.
The financial assistance program this time is far larger than what was implemented in 2020. At the time, the government spent 12.2 trillion won to hand out emergency relief cash to nearly everyone.
According to this bill, up to 3 million won will be paid to 3.32 million people operating small businesses, whose sales went down amid the pandemic. Another 680,000 self-employed or freelance workers, such as afterschool lecturers and replacement drivers, will receive up to 1 million won.
Another 76,000 corporate taxi drivers and 86,000 city and charter bus drivers will each receive 1 million won. About 40,000 artists will also each receive 1 million won.
The bill also stipulates that the government will increase the ratio of loss compensation for small businesses. Until now, the government compensated 80 percent of a business's loss caused by pandemic restrictions such as shortened operation hours, but this will now be increased to 90 percent compensation.
Restaurants and cafes that have limited the numbers of customers and placed partitions due to social distancing measures will also be eligible for loss compensation.
The government will spend 2.8 trillion won for more Covid-19 response measures such as offering home test kits to 6 million people including low-income families and infants and toddlers using childcare facilities. Four test kits per month will be offered for two months.
After the government submitted the bill last month, the ruling Democratic Party (DP) and the main opposition People Power Party (PPP) butted heads over the amount for weeks. The DP originally planned to open a voting session alone on Monday evening and use its majority to approve the bill, but the PPP proposed a last minute compromise and the two sides struck a deal.
The voting session started at 8:28 p.m. on Monday and the lawmakers took only 11 minutes to pass it, with an overwhelming majority. Of the 213 lawmakers, 203 voted for, 1 against and nine abstained.
The passage of the massive supplementary budget comes just a few weeks before the March 9 presidential election. Critics have scoffed that both the DP and PPP are using the supplementary budget to buy votes.
With the approval of the supplementary budget, Korea's national debt will increase from 1,064.4 trillion won to 1,075.7 trillion won. At the end of last year, the national debt was at 965.3 trillion won.
The debt-to-GDP ratio will be increased from 50 percent to 50.1 percent.

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