- POSTED: 03 Sep 2014 22:20
South Korea's local governments on Wednesday (Sep 3) made the unprecedented move of challenging central government over lack of welfare support, a key concern in one of the world's most rapidly ageing societies.
SEOUL: South Korea's local governments on Wednesday (Sep 3) made the unprecedented move of challenging central government over lack of welfare support, a key concern in one of the world's most rapidly ageing societies.
It is the first time that local authorities have grouped together against the government - they are warning that they will be unable to meet spending requirements on welfare unless they are given more support.
The government has promised to spend 316 trillion won (US$312 billion) between now and 2018 on social spending to expand childcare support, allocate more funds for senior citizens, reduce medical expenses and raise the fertility rate. But the heads of the country's 226 small cities, counties and wards warned they would be unable to meet welfare spending unless the central government expanded support for them to deliver its policies.
"Local administrations face a financial crisis because the government has shirked its responsibility to us," they said in a joint statement. "Our default on welfare spending is inevitable if the current situation goes on," the statement read.
Along with increased payment for supporting child care, the government launched a basic pension scheme for senior citizens this year. The financial burden will grow further due to a sharp rise in the number of pensioners.
Local administrations want the central government to increase local tax rates and expand its share of the costs for basic pension and child care benefits. But financial officials have accused local authorities of squandering money on unnecessary projects such as luxury office buildings and prestige events.
The government is pushing to hike cigarette prices by more than 30 percent this year in a bid to cope with the rising welfare bill.