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[Editorial] Ill-advised subsidies

April 19, 2012 - 19:26 By Yu Kun-ha
The Ministry of Health and Welfare has recently revised a regulation on daycare services to ensure that working moms and families with multiple children have priority in enrolling their toddlers at daycare facilities.

The measure was necessitated by a surge in demand for daycare services for children aged 0-2 years.

Starting March, the government expanded its subsidy program for children under 24 months old. Previously, the subsidy was given to families in the bottom 70 percent of the income ladder. Under the new scheme, it was provided to all families, regardless of their income, if they register their children with a day care center.

This universal subsidy program naturally boosted child care enrollment. It led stay-at-home moms who took care of their children at home to opt for day care services, confirming the saying that no one refuses a free lunch.

As a result, some working moms who were in greater need of daycare centers were crowded out. They lodged complaints with the ministry, criticizing the government’s ill-advised subsidy policy.

Hence the revised regulation that gives working moms and families with three or more children priority in accessing day care services. This regulation is currently applied to state-run daycare centers. Starting July 1, it is to be applied to all daycare facilities around the country.

This rule change looks reasonable. Yet it is not without problems. It does not take into account mothers who stay home full time but are unable to look after their children for some reasons, such as poor health. These mothers are already complaining about the changed regulation as it will make it more difficult for them to secure a slot for their kids.

All this fuss was kicked up by lawmakers who hastily expanded the subsidy program in their bid to curry favor with voters.

Welfare programs also cause a waste of taxpayers’ money if not properly implemented. In March, the government also introduced a universal subsidy program for children aged 5 years. A recent survey has found that it has not contributed to reducing the burden of parents.

According to the survey, the well-intended program ended up lining the pockets of the operators of kindergartens, who have raised their fees by the same amount as the new subsidy. The government should have prepared for this possibility before implementing the new scheme.

Next year, the government will introduce a similar program for children aged 3-4 years. It needs to ensure that the scheme benefits parents, not kindergarten operators.