The financial independence of districts in Seoul City hit a record low amid the escalating cost burden of public welfare measures, officials said Tuesday.
According to Seoul Metropolitan Government, the self-reliance rate of 25 districts on average plummeted to 31.5 percent this year, reaching the lowest mark since the city started to draft and execute its own budget under an elected mayor in 1995.
The self-reliance rate, which is the ratio of district offices’ own revenue sources such as local taxes to overall revenue, indicates the level of fiscal strength of the districts.
Since 1995, the overall financial independence has remained over 50 percent but the number started to plummet from 2010. Last year, the average rate dropped to 33.6 percent, the authorities said.
The self-reliance level differed by regions.
While Gangnam-gu and Seocho-gu in the affluent southern region and Jung-gu in central Seoul remained above 50 percent, most northern residential districts such as Nowon-gu and Dobong-gu recorded less than 20 percent, the city said.
The growing burden of public child care services and the basic pension scheme for the elderly have affected financial independence, it added.
As part of President Park Geun-hye’s presidential election pledges, the government expanded the existing public child care program to children aged 5 or younger since 2013, and started to provide around 150,000 ($137) to 200,000 won allowance for the elderly aged 65 or older since 2014.
“Seoul City and district offices have been asked to share the cost burden way too much by the central government since it introduced the universal welfare schemes ― free child care and basic pension for senior citizens,” city officials said.
The districts are currently shouldering 343 billion won a year for the child care scheme, which is more than 30 percent of the total cost. For the elderly basic pension program, local offices are shouldering 218 billion won or 15 percent of the total cost, they said.
By Lee Hyun-jeong (
rene@heraldcorp.com)
