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2011 spending plans meant to reverse the country’s very low birthrate
September 17, 2010
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| Korea plans to increase spending on child-care services and education in the 2011 budget to improve living standards for low- and middle-income families and reverse the country’s extremely low birthrate. The plan, outlined at an economic policy meeting chaired by President Lee Myung-bak, calls for the overall budget to be set at around 310 trillion won ($266.8 billion) next year, smaller than the 312.9 trillion won requested by government ministries. Under the proposed budget, the government aims to spend 3.72 trillion won to expand free child-care services, vocational education support and assistance for multicultural families. This represents a 33.4 percent increase in outlays compared to the 2.79 trillion won earmarked for these welfare programs this year. Of the total, 3.26 trillion won will be used to cover free child care to encourage people to have more children. Korea had one of the lowest birthrates in the world in 2009 with a fertility rate of 1.15 children compared to an average of 1.71 for Organization for Economic Cooperation and Development countries. The government will spend 366.9 billion won to pay for the tuition of all students attending the country’s 691 vocational high schools, with 86 billion to be used to help multicultural families. To achieve a balanced budget, the deficit will be reduced to 2.3 percent of gross domestic product in 2011 from 2.7 percent for 2010, while the national debt will be cut to 35 percent of GDP in 2011 from 36.1 percent in 2010. “Next year’s budget is to carry out policies that can benefit low-income households,” Lee said. “The biggest task is to revive their living conditions.” The 20 percent increase in child welfare spending is meant to make more families eligible for day-care services. Around 50 percent of families are now entitled to government support for child care, but the number will be raised to 70 percent. Now, a family of four with only one wage earner, who makes 2.58 million won or less a month, qualifies for child-care benefits. But the rules will be expanded to include families with a monthly income of up to 4.5 million won. Wages for working mothers on maternity leave will be guaranteed up to 1 million won a month, an increase from 500,000 won. Multicultural families will be entitled to child-care benefits regardless of their income. By Limb Jae-un [jbiz91@joongang.co.kr] |
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