The government on Sunday agreed on a third round of coronavirus payouts to the tune of W4 trillion (US$1=W1,103).
The money will come out of next year’s budget and will be given to self-employed people and small businesses. The government hopes to pay the money out in January or February.
The ruling Minjoo Party has already promised to set aside W1.3 trillion to procure COVID-19 vaccines for 44 million people. If all goes to plan, the budget will increase from the already proposed W556 trillion to around W558 trillion reflecting increased expenses incurred by the epidemic, and the government will issue around W2 trillion worth of bonds to pay for them.
An MP lawmaker told the Chosun Ilbo, “The ruling and opposition parties are negotiating the budget, so a final decision should be made this week.”
But the main opposition People Power Party, which had proposed the third round of relief payouts, is now opposed to issuing bonds. Choo Kyung-ho, a ranking PPP member of the National Assembly’s budget committee, said, “The government’s 2021 budget [W556 trillion] already includes W90 trillion in debt, and trying to increase borrowing without shaving W2 trillion from the super-sized budget is irresponsible.”
The government spent W14.3 trillion to finance the first round of relief payouts and W7.8 trillion for the second. The second round of payouts was entirely financed by bonds, and Korea’s fiscal debt soared to W846.9 trillion, while the ratio of fiscal debt to GDP has reached a record 43.9 percent.
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