Choo Kyung-ho: "Senior Officials at Minister and Vice Minister Level to Return 10% of Next Year's Salary"

"Prices Won't Reach 7%... Staying in the Low 6% Range, Expected to Drop to the 5% Range Soon"

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho (fourth from the left) is inspecting the highland cabbage crop being harvested on August 13 in Anbandegi, Wangsang-myeon, Gangneung-si, Gangwon Province. 2022.8.13 [Image source=Yonhap News]

[Asia Economy Gangneung=Reporter Son Seon-hee] Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho announced on the 13th, "Senior officials at the minister and vice minister level plan to return 10% of their salaries next year." This is intended to show leadership starting from the public sector as the government attempts high-intensity expenditure restructuring during the budget formulation process for next year.

Regarding the consumer price inflation rate, which has recorded over 6% for two consecutive months, Deputy Prime Minister Choo predicted, "It will be slightly above 6% initially and then decrease," adding, "The day when we see a '5' in the inflation rate is not far off."

Visiting Gangwon Province to inspect agricultural product shipment sites, Deputy Prime Minister Choo held a press conference at a restaurant in Gangneung city in the afternoon and said, "(The salaries of senior officials at the minister and vice minister level next year) will first be frozen and then 10% returned." However, he added, "For lower ranks, since the current inflation level is quite high and there are morale issues among public officials, we are conducting a final review that encompasses both treatment improvements and the public's expectations for leadership in the public sector."

As the government is actively working on the budget formulation for next year, Deputy Prime Minister Choo stated regarding the total expenditure scale for next year, "For the first time since 2010, including supplementary budgets, we will formulate a budget significantly reduced compared to the previous year."

The total expenditure scale of this year's main budget, formulated by the government last year, is 607.7 trillion won. With two supplementary budgets implemented this year, the total expenditure including supplementary budgets increased to 679.5 trillion won. The main budget total expenditure for next year is expected to be set at a lower level than this. This is the first time in 13 years since 2010 that the total expenditure including supplementary budgets decreases compared to the previous year when formulating the main budget.

Deputy Prime Minister Choo said, "Under the Moon Jae-in administration, total expenditure almost surged, and despite several supplementary budgets, the next year's main budget was formulated at a higher level than that," adding, "This time, it will be significantly lower than the supplementary budget (total expenditure)." He also added, "The scale of expenditure restructuring will also be at an all-time high."

Regarding the rapidly increasing national debt, Deputy Prime Minister Choo said, "Due to the very high level of debt, it is impossible to formulate next year's budget without issuing any debt," but added, "We will include the necessary appropriate resource expenditure, but a significant portion will be secured through expenditure restructuring." He said the issuance volume of government bonds next year "will have to be somewhat reduced compared to this year to slow the pace of debt increase."

Meanwhile, when asked about inflation forecasts, Deputy Prime Minister Choo said, "Some people say it could exceed 7%, but unless a truly extraordinary event occurs, it will not go that high," and predicted, "It will be slightly above 6% initially and then decrease."