Recently, South Korea’s Family Support Obligation Law (hereinafter “Obligation Law”) was criticized for contributing to a poverty-related tragedy. According to KBS NEWS, in December, 2020, a developmentally disabled man was found wandering the streets with his dead mother’s body left unattended for more than half a year in Bangbae-dong, Seoul. Investigation into him and his mother revealed their dire financial situation. It turned out to be the Obligation Law that tied the son with his estranged father’s wages, making the family ineligible for additional government financial support. This incident tipped the public’s impatience about the law into indignation, to which the government responded with its abolition.

Complications with the Obligation Law

Obligating those with a certain level of income to support their family members, the Family Support Obligation Law is aimed to ensure an acceptable quality of life for everyone. This law is part of the National Basic Livelihood Security Act, a decree that provides basic care benefits for low-income families that lack working capacity. However, certain criteria need to be met for these potential recipients to gain assistance from the Act. One such criterion is associated with the Obligation Law in that even if the applicants’ incomes suffice the standards, they cannot become beneficiaries if their parents or children’s revenue exceed specific amounts. Thus, the Obligation Law’s demands create a blind spot in the welfare system, neglecting a pool of people who do not receive financial support from either government or family.

To make matters worse, the law has been criticized for being based on an outdated Confucianist conception of “family” that considers family members providing for each other as the obvious norm. The reality is that some families are estranged, and nuclear families have increased; contemporary society’s familial structures have changed, and so have its viewpoints on family. According to Seoul Economy, Statistics Korea’s 2017 data reported that people who believed adult children must be responsible for their parents dropped from 70 to 30 percent in 14 years. Being incompatible with society, the Obligation Law needed to be either reformed or eradicated.

Changes Made in the Welfare System

Responding to criticism, the Seoul Metropolitan Government announced the total elimination of the law on April 28. Now, citizens of Seoul can receive financial assistance from the city as long as they meet the household income and property standards regardless of their family members. The Government predicted that with complete eradication, approximately 2,300 people who were previously ineligible will promptly be able to receive additional provision. It also added, “We will provide closer support through the abolition for the poor, who are increasing due to the coronavirus disease (COVID-19).”

Moreover, the Ministry of Health and Welfare reported in May that more than 60,000 households have newly received the sustenance wages in the four months after the Obligation Law’s standards were further alleviated in January. The ministry forecasted that an additional 95,000 households approximately will be paid the same benefits by the end of the year, totaling to a 157,000 households.

Expectations and Concerns

Ending the Obligation Law has raked in optimistic attention from the public. The change has been deemed the "last safety net," expected to remove welfare blind spots and substantially improve poverty indicators. It is predicted to greatly improve the quality of life of those in poverty that previously could not receive basic security. Moreover, it can serve as a turning point for the family-market-state role-sharing welfare model. In terms of medical security, Professor Kim Anna (Department of Social Welfare, Daegu Catholic University) stated that the abolition could “possibly reduce disastrous medical expenditures by strengthening medical security for the once non-supplied poor,” in the short term, where overall spending can be approximated.

Nonetheless, concerns have also surfaced. Assuming that the framework of the current system is maintained, the surge in beneficiaries could cause a problem in securing a sustainable budget. Regarding medical benefits, there is a limit to predicting the level of expenditure from paying afterwards the treatment in the long run, which can affect other benefit fields as well, according to Professor Kim. The most pessimistic forecast is the downfall of entire welfare infrastructure, induced by the exhaustion of monetary assistance, lack of supplies, and exploitation by idle laborers. Specifically, Professor Kim contends that “moral slacking might prevail,” such as parents inheriting property from their children in advance and unnecessarily receiving public support from the state.

The Road that Needs to be Taken

The immediate task is to strengthen the multi-layered safety net for the impoverished and prepare a sturdier management mechanism. In Professor Kim’s words, discussions on the effects of abolishing the law need to be approached from a "de facto" perspective of resolving blind spots in basic security, which is the original the starting point of whole controversy.

This means that the focus should be on enhancing the system related to the blind spots of the current welfare policies. To begin with, the mentioned solution is to exempt applicants from the responsibility of proving their support status and to introduce an "assistance first, collection later" system in applying for basic living guarantees. This way, the difficulties of living will be solved first, then the applicants will be checked for their situations, the last step being collection of provisions, thereby minimizing immediate financial burden and resolving welfare blind spots.

In addition, Professor Kim stated that she supports the idea of actively strengthening information links such as the National Tax Service and Happy E-um, the Social Security Information System. She further argued that scrutiny of the two systems is indispensable in preventing moral hazard, in which officials will thoroughly assess incomes and property changes. Accordingly, further reformation of the current arrangement will be able to resolve the problems of fiscal budget depletion and abuse of the system.

With the prolonged pandemic, there has never been a more urgent occasion to focus on impoverished and low-income families. The Seoul Metropolitan Government has timely answered by abolishing the Family Support Obligation Law, and the government plans to do the same by 2022 after gradually reducing the number of those affected by the law. In conclusion, we can only hope that after dealing with some related concerns, the abolition will encourage Korea to cross a threshold to become more fitting for the term “welfare state”.