Localities struggle as gov't expands benefits for multi-child families
Published: 01 Nov. 2023, 15:51
Updated: 01 Nov. 2023, 19:30
- LEE SOO-JUNG
- lee.soojung1@joongang.co.kr
The Yoon Suk Yeol government announced in August plans to make families with two children eligible for a wide range of benefits, part of the administration's efforts to turn around the country’s record-low fertility rate.
These benefits include discounts on public transportation, public parking, cultural events such as museums and performances, welfare services and even taxes.
With the changes, local governments must give discounts to more families for services and public facilities.
Local governments implement the changes differently.
In Busan, the changes have been applied starting Tuesday.
Busan National Sports Center, a public fitness and health facility, on Oct. 19 announced that it is discontinuing its child development program, its most popular service over the past two decades.
The curriculum under the program includes classes on sports, arts and even traditional Korean music, gukak.
However, the sports center ended the program as it faced massive financial losses from the predicted surge in families eligible for 50 percent discounts.
Before the threshold change, only 10 percent of enrollees were eligible for the discount. However, after the change, enrollees eligible for the discount would climb 77 percent.
The center estimated its annual net loss would surge from 120 million won ($88,481) to 500 million won under the change.
The National Olympics Memorial Dormitory Busan Social and Sports Center faces a similar challenge.
With more families paying less due to the expanded discounts, its annual net loss is expected to triple from 210 million won to 637 million won.
“The city government will come up with measures to cover the losses generated from the changes,” a Busan city official said.
While local governments usually cover the losses of public facilities, some jurisdictions are running on a tight budget.
The city government currently spends 3.6 billion won every year to cover losses incurred by discount public transportation discounts to roughly 20,000 families with three or more children.
This loss would increase exponentially as the number of households benefiting from the public transportation discount would increase by 115,000.
“We’re faced with challenges because we have to provide benefits within our limited means,” a Daegu official said.
“Local governments differ in their tax sources and financial situations,” said Kim Dae-rae, a professor emeritus at Silla University. “The policies can work only when the central government covers at least some of the spending on birth, child care and welfare.”
The fertility rate is the average number of births projected for a woman during her reproductive years. A total fertility rate of above 2 is needed to sustain a country’s population if not accounting for migration.
BY KIM MIN-JU, LEE SOO-JUNG [lee.soojung1@joongang.co.kr]
with the Korea JoongAng Daily
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