80% of South Koreans to receive W250,000 cash relief

Some 80 percent of South Koreans will receive 250,000 won ($220) each in the latest COVID-19 cash handout program, officials said Thursday.

After a pangovernmental meeting, officials said they have decided to earmark 10.4 trillion won for the nation’s fifth cash relief program. The money will be funneled from the nation’s 33 trillion-won second COVID-19 extra budget for this year, which the ruling party and government jointly unveiled Tuesday.

The “bottom 80 percent income bracket” will be the beneficiaries of the program, the ruling Democratic Party of Korea said earlier, and the recipients would be determined by the same calculations used to group beneficiaries of the National Health Insurance Service. Vice Finance Minister Ahn Do-geol said in Tuesday’s briefing that the NHIS standard was chosen as the program covers all of Korea’s population.

Unlike the first emergency cash handout program that was carried out in mid-2020 -- which placed a cap on the money handed out depending on the number of people in a household – all recipients considered as “the bottom 80 percent income bracket” will receive 250,000 won each.

Some 18 million households out of a total 23 million households here would be eligible to apply for the program, the government said.

Applications will be received both online and offline, similar to the first cash handout program, and the cash is to be distributed in the form of debit or prepaid cards.

Some 3 million people in lower income brackets living off basic income or those who are members of single-parent families will receive an additional 100,000 won per person.

The government plans to launch a task force to draw up a specific system and other details for the cash relief program. It aims to start handing out the subsidies within a month after the National Assembly approves the latest extra budget. The budget is slated to be approved on Friday.

Despite mounting public anticipation for the cash subsidy program, the NHIS yardstick used to determine the recipients is expected to reignite criticism that the standards are “too vague.” Last year, some complained they had received lackluster support due the NHIS’ belated move to take job and income losses due to COVID-19 into account.

Referring to the concerns, a Finance Ministry official said that necessary procedures to review any on-year income losses in 2020 will take place.

By Jung Min-kyung (mkjung@heraldcorp.com)