The South Korean government has launched a national survey to assess public opinion on a new policy proposal that offers a cash payment of 100 million won ($72,491) to families with newborn children to address the country’s declining birth rates.
Currently, the government’s efforts to combat low birth rates primarily involve support in indirect ways, such as subsidies for childbirth and childcare expenses and providing parenting services.
However, the new proposal aims to adopt a direct cash support approach. Given that the government has already spent over $217.4 billion on addressing the issue of declining birth rates, without any tangible results, it seems to be considering a change in its policy approach.
On Apr. 22, the Anti-Corruption and Civil Rights Commission announced that it had started a public survey through its official website from Apr. 17 to hear feedback on the proposal of awarding $72,491 to families with newborn children.
The survey seeks to understand if a direct financial incentive of $72,491 would encourage people to have children, whether a state-funded program with an estimated annual cost of $16.6 billion is acceptable, and if funds from other similar programs, such as regional extinction mitigation, could be utilized.
The survey is open to all citizens until Apr. 26 and requires mobile phone verification to prevent multiple responses.
The government’s complete reassessment of its low birth rate policies is driven by the recognition that previous policies have been ineffective.
According to the National Assembly Budget Office, from 2006 until last year, the government spent $275.4 billion, over a period of 18 years, exclusively on the central government budget, excluding local initiatives.
Despite these efforts, the decline in birth rates has not been reversed. Over the span of 18 years, the total fertility rate (the expected number of births per woman over her lifetime) has fallen from 1.13 in 2006 to 0.72 in the last year, representing a nearly 40% decrease.
The government is currently exploring the possibility of adopting a welfare system similar to the one recently introduced by the Booyoung Group. This system provides $72,491 per child to employees who have children and also grants the choice between receiving the money or the right to live rent-free in a public housing sized unit to those who have a third child.
There were some concerns regarding taxes, such as gift tax, income tax, and corporate tax, which could amount to approximately $28,993. However, last month, the government decided to completely exempt these taxes if companies provide childbirth incentives to their employees.
The government is now deliberating whether implementing this system nationally is feasible and whether it would receive public support.
