Hong Nam-ki: "19.5 Trillion Won Support Plan, Principle of Appropriate Support for Fiscal Sustainability"

Prime Minister Chung Sye-kyun and Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki are attending the Cabinet meeting held at the Government Seoul Office in Jongno-gu, Seoul on the 2nd. Photo by Moon Honam munonam@

[Sejong=Asia Economy Reporter Kim Hyunjung] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, announced a customized COVID-19 damage support plan worth 19.5 trillion won on the 2nd, stating, "We adhered to the principle of providing support as appropriately as possible from the perspective of fiscal sustainability."

On the morning of the same day, Deputy Prime Minister Hong announced the customized COVID-19 damage support plan at the Seoul Government Complex, saying, "The government will perform its role as actively as possible within the tolerable range of our national finances during national and livelihood crises, and also ensure that taxpayers' money is used most efficiently and appropriately." Prior to this, regarding the basis for preparing the support plan, he explained, "We set three principles: ▲concentrated support for groups heavily affected ▲thicker support and maximum reinforcement of blind spots ▲support as appropriately as possible from the perspective of fiscal sustainability."

He said, "While establishing the framework of the plan, we considered that this year's main budget, which increased by about 9% (46 trillion won), is also a very important support tool, and set it as a two-track package combining the supplementary budget bill and the utilization of the existing budget (558 trillion won)." He added that the total size of the support plan, 19.5 trillion won, consists of 15 trillion won from the supplementary budget and 4.5 trillion won from the existing budget. He emphasized, "The 15 trillion won supplementary budget is largely composed of three areas: 8.1 trillion won for support payments to affected groups, 2.8 trillion won for responding to employment shocks, and 4.1 trillion won for vaccines and other quarantine needs." He also noted, "Among these, the support payments to affected groups are about twice the amount of the third round of the Emergency Relief Fund (4.1 trillion won)."

Regarding the issuance of government bonds to secure funding, he stressed that available resources were maximized to minimize deficit bond issuance. He explained, "We discovered and utilized a total of 5.1 trillion won, including 2.6 trillion won from special account surplus funds available at this point, 800 billion won from the Bank of Korea's settlement surplus, and 1.7 trillion won from fund reserves, and the remaining shortfall of 9.9 trillion won was inevitably raised through government bond issuance."

Deputy Prime Minister Hong said, "Since this customized damage support plan was prepared by tightly supplementing the blind spots of existing measures, I sincerely hope that its warmth will reach each and every citizen experiencing difficulties, becoming a strong support to help them stand again and a new hope to return to daily life." He added, "The power of the supplementary budget is maximized when it is injected in a timely manner. The government will submit the supplementary budget bill to the National Assembly on the 4th." He continued, "We request the National Assembly to approve the supplementary budget as quickly as possible during the March extraordinary session," and added, "The government will also make every effort to prepare for the supplementary budget execution in advance so that it can be implemented immediately upon approval by the National Assembly."