Most of resources to come from budget cuts in construction projects


The Seoul city administration’s welfare budget for next year is expected to increase by 300 billion won ($254 million) to 3.2 trillion won, city officials said Sunday.

According to the municipal government, new mayor Park Won-soon directed a readjustment of the minimum cost of living. Once the cost is readjusted, an additional 300 billion won will be needed to fulfill the new standard, officials estimated.

They said given the fact that Park has often mentioned a “welfare utopia,” covering a wide range of benefits from subsidy to establishing cultural, communal and other infrastructure within the city, the amount may go higher.

“The budget for gender equality, family affairs, housing, education and others will cost a fortune,” an official said.

The civic activist-turned-mayor had pledged during his campaign to maintain a certain standard of living among all citizens upon his election.

“The current support program does not meet the standard of living in a metropolitan city, which is more expensive than that in rural or suburban areas. The new standard should be in line with the OECD and other global indices,” he was quoted as saying at a high-ranking officials’ meeting on Saturday.

According to the OECD guideline, 13.7 percent of people in society could be classified as underprivileged and therefore qualified for some form of state support. It means that of 10.5 million Seoul citizens, 1.4 million could become beneficiaries of the welfare policy, administration insiders forecasted.

Currently, a total of 207,000 people are subject to the state livelihood support program meting out 1.2 trillion won a year. The new standard will increase the number of recipients.

The increased budget will also be allocated to finance free lunches at public schools, expanded public daycare services, more lease apartments, student loans and halved tuition at the University of Seoul.

Most of the fiscal resources for the welfare projects will stem from budget cuts for “hardware programs” such as construction projects.

In a news briefing Friday, Park vowed to downsize Hangang Renaissance project (redeveloping Han River bay area) and interior design of Dongdaemun Design Plaza.

He also said that Seoul will scrap the construction of the interchange at Hangang Park and the creation of parks on skyscraper rooftops alongside establishment of trails in Amsa-dong.

The new mayor also vowed to pay off 7 trillion of in the municipal government’s 25.5 trillion won debt while in office.

However, skepticism is mounting over whether his liberal welfare plans can be realized.

“Because Park’s zeal to push welfare to the front was so strong, officials have hastily come up with cost-saving programs to fund the welfare policies. However, it is doubtful whether they could be executed,” a political observer said.

The city council will decide whether to approve the Seoul budget on Nov. 15.

By Bae Ji-sook (baejisook@heraldcorp.com)