Nation mixed on use of relief money

By Kang Seung-woo

As the government begins the rolls out its COVID-19 emergency relief funds, questions are arising about how to channel those funds to best support those in need.

In the political arena, one side is calling for the wealthy or those who simply wish to help others in need to donate the funds in preparation for a second surge of coronavirus infections while the other side claims those same recipients should spend the aid money directly in their communities to revive slumping local economies.

Since May 4, the relief money has been distributed to all citizens to help them deal with financial strain from the coronavirus pandemic, but people can also opt to donate all or part of their share so the money can be used for the government's unemployment insurance programs. It is paid in the form of credit or debit card points, regional gift certificates or prepaid cards.

Political and business circles have joined a government-led campaign for people in high-income brackets to donate their share, hoping the payouts will be used for the needy. Last week, President Moon Jae-in announced he would not apply for the relief fund ― which results in an automatic donation of the funds.

The leadership of the ruling Democratic Party of Korea (DPK) vowed, Wednesday, to make a donation where the payouts will be used to stabilize the people's livelihood and revitalize the economy during this health crisis.

“We're sure our united efforts will serve as priming water for the country to overcome the COVID-19 crisis,” a representative said on behalf of the group of 68 newly elected DPK lawmakers.

Many members of opposition parties also promised they would not apply for the funds, mostly due to concerns over the country's financial soundness. To give the relief money to every household, a measure the DPK offered as a campaign pledge for the April 15 general election, the government had to issue bonds, which would lead to growing national debt.

“National debt has surged and the state coffer has become empty due to the government's populist economic policy,” Hong Joon-pyo, a former chairman of the main opposition Liberty Korea Party, which was later renamed United Future Party, who was elected to the National Assembly as independent candidate last month, said on Facebook.

Major companies are jumping on the donation bandwagon as well.

Managements of leading financial groups, including Shinhan, Woori and BNK, expressed their decision to donate their shares, while executives of major conglomerates such as Samsung, SK, LG and Lotte also have plans to donate the aid funds in a bid to let the money be spent on more essential needs.

However, some local government heads urge public servants and citizens to take the money and spend it to boost the local economy as many self-employed people, such as restaurant owners and shopkeepers, have been hit hard by the COVID-19 pandemic.

The Gangwon Provincial Office, teaming up with civic groups, launched a campaign, Wednesday, to promote consumption with the relief money.

“If we donate the relief funds, they will return to the state coffers. I will not give the money back and will spend it in the local economy,” Gangwon Gov. Choi Moon-soon said, Wednesday, during a launching ceremony in Chuncheon, where his office is located.

“The goal of the emergency disaster relief funds is to encourage consumption activity and revive the local economy, so we ask people to spend it quickly.”

According to the provincial office, its officials plan to visit traditional markets in the region and spend the relief money there starting next week.

A total of 720,000 households in the province are eligible for the relief package and the amount is estimated to be 434.5 billion won ($354 million).