President Moon Jae-in has decided to provide financial support to households in the bottom 70 percent income bracket to help them get through the COVID-19 outbreak.
At the third session of the emergency economic council on Monday Moon said that a four-person family would get one million won, roughly 820 U.S. dollars.
The amount of support will differ depending on the size of the family.
Some 14 million households are expected to benefit from the program with aid to be given in the form of vouchers or digital currency.
The president said that it was not an easy decision given that the package is expected to cost roughly 7.4 billion dollars but he said people have the right to receive benefits, citing their participation in quarantine efforts.
The reason the government made the decision despite the sizeable fiscal burden was to support the livelihoods of the people and encourage those who have been sacrificing in their daily lives and help them overcome the crisis.
To fund the program, the government will cooperate with local authorities as well as draw up a second supplementary budget worth almost 5.8 billion dollars with the aim of having it passed at the National Assembly by April.
Noting that not all citizens will be eligible for the financial aid, Moon asked for understanding from those who are economically better off, saying that the government needs to maintain enough fiscal room to prepare for any potential economic shock.
The government needs to prepare for an economic shock whose end is unforeseeable and leave enough fiscal capacity to swiftly respond to employment problems and corporate liquidity. We will also restructure the government's spending plans in order to secure enough financing and to ensure the political parties can swiftly reach a deal.
Moon added that the government will reduce or postpone payments of four social insurances, including health insurance and national pensions, as well as utility fees for the low-income tier, the self-employed and small businesses.
He said that it's hoped that the burden of living expenses will be eased for the low-income bracket, and that small businesses will be able to operate normally and maintain employment.
According to the top office, President Moon said that the latest measures are aimed at boosting confidence in the government's economic policies. It added that if all goes according to plan, financial aid will be disbursed in mid-May. Kim Min-ji, Arirang News.