'2+2 Council' Tug of War Between Ruling and Opposition Parties... Leading to 'Floor Leaders' Final Negotiation' (Comprehensive)

"Despite Consensus on 'Regular National Assembly Processing,' Numerous Contentious Issues Remain
Presidential Office Relocation and Local Currency Among 'Landmines'"

On the afternoon of the 5th, Sung Il-jong, Chairman of the Policy Committee of the People Power Party, and Kim Seong-hwan, Chairman of the Policy Committee of the Democratic Party of Korea, moved to the negotiation room after finishing a briefing ahead of the ruling and opposition 2+2 budget negotiations held at the National Assembly Members' Office Building. From left to right: Lee Cheol-gyu, Secretary of the Budget and Accounts Committee of the People Power Party; Kim Seong-hwan, Chairman of the Policy Committee of the Democratic Party of Korea; Sung Il-jong, Chairman of the Policy Committee of the People Power Party; Park Jeong, Secretary of the Budget and Accounts Committee of the Democratic Party of Korea. [Image source=Yonhap News]

[Asia Economy Reporter Jang Hee-jun] The ruling and opposition parties held final negotiations on the 5th through the '2+2 consultative body' launched to speed up the review of next year's budget, which exceeded the legal deadline (December 2), but continued a tug-of-war by exposing disagreements over contentious budgets such as the presidential office relocation and local currency.

The ruling and opposition parties plan to hold a final showdown in the '3+3 consultative body,' which includes the floor leaders of both parties, starting from the 6th if no agreement is reached. However, it is uncertain whether they will be able to narrow their differences. Nonetheless, since both parties agree that the budget must be passed within the regular session ending on the 9th, there remains a possibility of a dramatic resolution.

Seong Il-jong, Chairman of the Policy Committee of the People Power Party, Kim Seong-hwan, Chairman of the Policy Committee of the Democratic Party, and Lee Cheol-gyu of the People Power Party and Park Jeong of the Democratic Party, who serve as secretaries of the National Assembly's Special Committee on Budget and Accounts, resumed budget negotiations at the National Assembly in the afternoon.

The relocation of the presidential office and the local currency budget still acted as obstacles in the negotiations. From the opening remarks of the meeting, the ruling and opposition parties engaged in a tense battle of wills, foreshadowing difficult negotiations.

Seong Il-jong, Chairman of the Policy Committee, said, "How can we manage the country with the budget drafted by the Democratic Party?" and requested, "Please help the side responsible (through the presidential election) to draft the budget."

In response, Kim Seong-hwan, Chairman of the Policy Committee, retorted, "It is not appropriate in this era to push for 'ultra-rich tax cuts' and ask to pass this budget, which drastically reduces the livelihood budget that should rightfully be allocated, just because you hold the authority to draft the budget."

Afterwards, the ruling and opposition parties reportedly clashed over contentious budgets during a closed-door meeting that lasted more than three hours, remaining at an impasse.

After the recess, Chairman Seong told reporters, "There is not much to cut in the presidential office relocation budget," adding, "I think those parts will probably be handed over to the floor leaders' negotiations, but we will try to adjust a bit more." He continued, "There are some budgets that we mutually agreed to reduce, but those requiring high-level judgment will be passed on to the floor leaders' talks."

Chairman Kim was reserved, saying, "There has been some progress in the negotiations, but it is difficult to talk about the details."

It is also known that the standoff continued over the so-called 'Lee Jae-myung budget' concerning the local currency budget. The Democratic Party insists that the local currency budget, which the Yoon Seok-yeol administration completely cut, should be significantly increased, but the People Power Party firmly refuses to accept this.

The standoff over the youth cost-price housing and public rental housing budgets also remained. The People Power Party insists on maintaining the original budget for the youth cost-price housing, a key government project, while the Democratic Party argues that this budget should be drastically cut and the public rental housing budget increased instead.

However, some progress was reportedly made on several livelihood budgets where the differences were not significant. A Budget Committee official said, "There has been considerable progress on non-political budgets, including the SMR (Small Modular Reactor) budget," adding, "There will not be many budgets left to be handled in the negotiations involving the floor leaders."

The ruling and opposition parties plan to continue follow-up negotiations through the night, and contentious budgets that fail to reach agreement will be addressed in the '3+3 consultative body' involving the floor leaders.