The ruling Grand National Party is pushing for state coverage of child care costs for all newborn babies starting next year through a budget hike of between 800 and 900 billion won.

Generous childcare support is part of a policy package GNP plans to unveil this week for those in their 20s through 40s, who shunned the ruling party in the Seoul mayoral by-election last month.

“We plan to expand the provision of child care costs and child endowments for children below the age of two to all families by 2014,” Lee Ju-young, chief of the GNP’s policy committee, said.

“In the budget deliberation for next year, we will focus on increasing the child care budget for infants under the age of one.”

Child care costs are offered to households that have child care centers look after their kids, while child endowments are given to families that keep theirs kids at home.

The government is set to provide 200,000 won per month in child care costs for 5-year-olds starting next year and 300,000 won from 2016.

The GNP, reeling from dwindling public support confirmed in the Oct. 26 mayoral by-election, is considering stretching the provision to all children under 5.

“We should go for universal welfare for children under the age of 5 as well,” Ahn Hong-joon, deputy chief of the GNP’s policy committee, said.

“There are no objections to extending state support of child care costs, which are now given to the lower 70 percent in income, to all households, and we are looking into how to expand the child endowments currently offered to only low-income families.”

For infants less than 12 months old, 400,000 won per month is offered in child care costs and 200,000 won in child endowments.

The governing party’s plan translates into a budget increase of 500 billion won for child care and between 300 and 400 billion won for child endowments.

The GNP is also reviewing tax incentives for small and medium-sized companies that increase employment, housing loans with no interest to first-time home buyers and housing vouchers to help low-income earners finance their rent.

By Kim So-hyun (sophie@heraldcorp.com)