The much-debated Triple Stimulus Voucher program was finally launched on Wednesday last week. Together with the consumer voucher scheme in 2009, the program — which is intended to stimulate domestic consumption and revitalize the economy — marks the second time the government has implemented a nationwide emergency relief measure in response to a crisis.
Despite this experience, the government seems to have been incapable of learning from 2009, and the program has caused much controversy.
Generally speaking, the government handing out money to the public is usually a popular move. As the COVID-19 pandemic brings drastic changes to the nation, and causes damage to its economy and society, it is a good thing that the government boosts the public’s purchasing power, in the hope that this will also affect domestic manufacturing and investment activities.
Unfortunately, several issues have emerged long before the program was implemented, indicating that the measure — well-intended as it is — is far from perfect. The government spending money on the public does not necessarily lead to a favorable public reaction, nor is it guaranteed that it will generate the expected effects.
Public opinion polls have shown clearly how the public views the program: A poll late last month indicated that while two-thirds of the public support the policy, two-thirds would have preferred direct cash handouts.
Online poll results this month also show that a majority -— more than three-quarters of the respondents — are dissatisfied with the implementation of the policy, citing that cash handouts were more convenient, and there were too many restrictions on the use of the vouchers.
While the policy is generally welcomed, the scheme comes with so many restrictions that most people find it inconvenient.
Handing out cash to people certainly would not be without problems, but is a reasonable and tested approach, as many countries have offered cash handouts as part of their pandemic relief measures.
The main reason that the government has opted for vouchers instead of cash — twice — can be attributed to the public’s inclination to deposit money in their savings accounts.
If the government handed out cash, many people might have only spent part of it and saved the rest, while some would not have spent the money at all, reducing the stimulative effect on the economy.
Although the government has taken the nation’s savings culture into consideration, and adapted the program accordingly, its rollout has still led to controversy.
The cost of manufacturing the vouchers is one major problem.
Opting for vouchers, the government knew it had to include anti-counterfeit features, leading to high production costs, which added to the overall high costs of the program.
The rollout is also taking a toll on workers in administrations, post offices, financial institutions and convenience stores.
Collecting the vouchers is time consuming. In the first days of the program, long lines formed in front of post offices and inside convenience stores, taking a toll on the mostly elderly members of the public who collected the vouchers for their families.
Compared with cash, which could have been handed out directly, the vouchers and their distribution created many hardships, especially for those who preferred physical vouchers over digital ones, as they had to preorder their vouchers in person which then could only be collected later. It is evident why the public had preferred cash handouts.
Another problem is the limitations on voucher usage. The government has restricted the use to certain categories of products, to guarantee that the vouchers are spent on additional consumption, rather than to cover existing expenses. For example, traffic tickets are excluded.
Yet there is an exception to every rule: for instance, even though e-commerce platforms are also excluded, platforms that sell tourism products and tickets for sports events are not. This arbitrary rule has sparked public confusion.
People who have linked the vouchers to their credit cards or electronic payment accounts face the problem that not all businesses accept their preferred payment tools.
The government has tried to satisfy the demands of everyone. However, people have vastly different preferences and needs, and to cover all those, the policy had to include too many options for preordering, collecting and using the vouchers, which require too many complicated regulations.
Businesses have also launched a myriad of discounts and special offers to be combined with the vouchers, which further complicates the matter.
Most people feel lost and unable to see through all their options, and eventually go for the easiest solution: physical vouchers, which could be as simple and clear as cash, but, as they are designed, harder to obtain and use.
Another problem is that physical vouchers come in two denominations, NT$200 and NT$500. If the vouchers are used for small purchases, for example at night markets, it puts a burden on vendors who have to handle relatively large sums of change.
Especially as vendors at markets, and small shops and businesses, have reservations about whether to accept vouchers and how to cash them in with the government.
As the nation’s performance in the fight against COVID-19 has been outstanding and decisive action has timely alleviated many problems, the voucher policy comes quite late. If the program had been implemented in spring, perhaps it could have resulted in increased spending, without the complications we see today.
The program’s name is also disappointing. Perhaps the government named it “Triple Stimulus Vouchers” because it is expected to create additional spending of NT$3,000. The public will hardly feel an immediate “triple” effect, as they first have to pay NT$1,000 to buy the vouchers. Those who use electronic vouchers will even have to spend NT$3,000 before getting NT$2,000 back.
The consumer voucher policy in 2009 did not bring the expected economic boost, mainly because most people used the vouchers to cover daily expenses instead of additional consumption.
Also, as the consumer vouchers did not circulate long enough, the policy’s effect was further limited.
It is too early to judge the effects of the Triple Stimulus Vouchers program, and the most important task at hand for the government is to promote the policy. As the program is unlikely to be the last COVID-19 relief measure, it is essential to conduct a careful independent review of its effects at all stages.
After all, the money being spent by the government comes from taxpayers.
Translated by Chang Ho-ming
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