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Health Ministry reverses stance on health insurance reform

Saenuri leader goes head-to-head against Park‘s welfare policies

By Korea Herald

Published : Feb. 3, 2015 - 19:39

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The Health Ministry said Tuesday it would push ahead with levying higher health insurance premiums to high-income earners, reversing its earlier decision not to pursue any changes in the current system amid escalating criticism over the government’s inconsistent welfare policies.

The decision came six days after Health Minister Moon Hyung-pyo backtracked on the plan aimed at easing the financial burden on low-income brackets and plugging loopholes in the system.

As Moon’s remark sparked a heated controversy, Cheong Wa Dae again reversed its decision the next day, stressing that the minister was expressing his own view and that the government would stick to the original plan.

Amid growing disputes over the government’s unclear policies, a high-ranking Health Ministry official told reporters that the government would soon propose a plan to reform the system and consult with the ruling Saenuri Party, noting that the new party leadership has promised to fully support the plan.

“With the new floor leader elected, the government and the party are likely to resume talks soon over the revamp of the national insurance fee,” the official said.

The ministry’s abrupt decision came a day after Rep. Yoo Seong-min won the primary vote for Saenuri Party leader on Monday, defeating former Maritime Minister Rep. Lee Joo-young, who is considered a pro-Park lawmaker.

Yoo’s victory was seen as a power shift in the party’s leadership, as the nonmainstream lawmaker was expected to make critical approaches to the president’s policies. Critics say Yoo’s victory will consolidate Saenuri chairman Rep. Kim Moo-sung’s control of the party. Rep. Kim is known as President Park’s longtime political rival.

Saenuri leader Kim went head-to-head against Park’s welfare policies earlier in the day, claiming it was impossible to implement welfare expansion without a tax boost.

“Welfare without a tax increase is impossible and it is inappropriate for a politician to deceive the public with such words,” Rep. Kim said in speech delivered at an extra parliamentary session that kicked off Tuesday.

Welfare expansion was the centerpiece of Park’s presidential campaign.

Park promised to provide free child care services and a higher monthly allowance for elderly citizens and to revise the current health insurance program to fairly impose fees based on subscribers’ income level. Park pledged to expand these welfare programs without increasing tax rates.

The president appeared confident in her first and second years in the office, as she vowed to create new income sources from the underground economy and curtail unnecessary and costly state-led projects.

The Park government, however, came recently under fire as it raised tobacco prices, pushed to reform public servants’ pension system and introduced a revised tax settlement scheme, which were seen as attempts to collect more money from ordinary wage earners to operate the costly welfare policies.

“Many voted for welfare pledges when the politicians introduced free child care, free meals and halved tuition fees,” said Rep. Kim. “Everyone applauded the campaign pledge making the state responsible for children’s education and (elderly) care, but nobody cared about paying the bills,” he said.

By Cho Chung-un (christory@heraldcorp.com)