Approval of 'Eyta Myeonje Hwanhwabeop' Relaxation Delayed by the National Assembly's Committee... Ruling Party to Re-push 'Fiscal Rules'

Ruling Party: "High Public Concern, Need to Gather Public Opinion"
Opposition: "Agreed to Process, Now Postponing?"

The amendment to the National Finance Act, which aims to ease the exemption criteria for preliminary feasibility studies (PFS) that assess the economic effects of new public investment projects such as roads and airports, is unlikely to pass the National Assembly's standing committee. With the general election for the National Assembly scheduled for next year, criticism is growing that the ruling and opposition parties are colluding to pass populist bills to address constituency complaints, prompting the ruling party to intervene.

The National Assembly's Strategy and Finance Committee postponed the plan to submit and approve the amendment to the National Finance Act at its plenary session on the afternoon of the 17th. Ryu Seong-geol, the ruling party's secretary of the committee, said, "There are many misunderstandings in the political circle that this amendment is populist in relation to next year's general election, so it is necessary to take more time to review it." Shin Dong-geun, the opposition party's secretary from the Democratic Party of Korea, also stated, "We decided to only process what has been agreed upon at this (today's plenary) meeting," adding, "If there is no agreement between the ruling and opposition parties, it will not be submitted." However, Shin criticized, "This bill was proposed first by them (People Power Party), and now that they want to process it, they are saying to postpone it, so isn't the National Assembly becoming a fool?"

Earlier, on the 12th, the Strategy and Finance Committee's Economic and Fiscal Subcommittee agreed to amend the criteria for PFS targets, raising the current total project cost threshold from 50 billion won to 100 billion won, and the national financial support scale from 30 billion won to 50 billion won. However, as criticism grew that easing the exemption criteria for PFS would lead to indiscriminate constituency projects ahead of next year's general election, the speed of processing the amendment was adjusted.

[Image source=Yonhap News]

Yoon Jae-ok, floor leader of the People Power Party, said at the party's Supreme Council meeting that day, "In a situation where fiscal soundness is deteriorating, there is growing public concern about whether such easing of PFS exemptions is desirable. This concern is not a matter of the ruling or opposition parties but a problem for the entire political circle," adding, "Given the difficult livelihood situation, I think it is necessary to carefully promote the bill after gathering public opinion."

Yoon also expressed his intention to re-push the amendment to the National Finance Act introducing fiscal rules, which had been postponed this month. He urged the Democratic Party, saying, "The discussion on legislating fiscal rules, which was delayed due to the Democratic Party's opposition, should be resumed," and added, "As a non-reserve currency country that relies on trade, our country's survival depends on fiscal soundness." With the processing of the bill easing PFS exemptions delayed, the ruling party is reportedly reconsidering linking it with fiscal rules.

However, since the opposition party is negative about introducing fiscal rules, the amendment's passage is expected to face difficulties. An opposition member of the Strategy and Finance Committee rebutted, "Originally, many lawmakers from both the ruling and opposition parties had proposed the PFS exemption bill, and consensus had been formed for some time," adding, "Since there is no agreement on fiscal rules, it seems they are holding this bill hostage."