People Power Party Likely to Boycott Vote
Dispute Over Special Activity Funds and Consumer Coupon Budget
Supplementary Budget Expected to Increase by About 2 Trillion Won
The supplementary budget bill, which exceeds 30 trillion won, is expected to pass the National Assembly plenary session on the afternoon of July 4, led by the Democratic Party of Korea. Due to disagreements over key issues such as the presidential office's special activity funds, the People Power Party may abstain from the vote after participating in the plenary debate. The total size of the supplementary budget is expected to increase by around 2 trillion won from the 30.5 trillion won originally submitted by the government.
On July 4, Kim Byungki, acting leader and floor leader of the Democratic Party, stated at the party's Supreme Council meeting, "The bipartisan agreement on the supplementary budget for people's livelihoods, which the People Power Party had promised, is now at risk of falling through." Kim explained, "The agreement failed around 1:30 a.m.," adding, "Today, the Democratic Party will push ahead with the supplementary budget as a priming measure for the people's livelihoods."
Earlier, Song Eonseok, interim leader and floor leader of the People Power Party, outlined the course of negotiations between the parties at a party strategy meeting. Song explained, "The People Power Party proposed that the government increase nationwide consumer coupons by 12 trillion won, and within the National Assembly, the Democratic Party demanded some additional measures."
Song further stated, "The People Power Party requested that the government and the Democratic Party agree to increase veterans' allowances, expand the Youth Leap Account, provide additional resources for employment stability, implement cost compensation measures for small business owners, add funding for sinkhole and water and sewage improvements, and expand local city gas supply." However, he added, "Negotiations did not proceed properly, and the government showed no intention to accept the projects requested by our party."
President Lee Jae Myung is delivering a supplementary budget policy speech at the National Assembly plenary session on the 26th of last month. Photo by Yonhap News
The main point of contention was the issue of an apology regarding the restoration of the presidential office's special activity fund budget. He said, "On November 29 last year, at the full session of the Special Committee on Budget and Accounts, the Democratic Party unilaterally passed the budget bill by only discussing reductions, without any discussion of increases." He continued, "At the time, they claimed that the lack of special activity funds would not paralyze state affairs and that it was absurd to say work could not be done without such funds, and so they unilaterally cut the budget." He went on to say, "But now that the administration has changed and they have become the president, suddenly they claim they cannot work without special activity funds and want them reinstated. This is a blatant display of shamelessness and hypocrisy."
A key official from the Democratic Party's floor leadership explained, "Regarding the issuance of consumer coupons, the Democratic Party proposed an 80% contribution from the central government and 20% from local governments, but the People Power Party wanted to reduce this cost and instead fund their own policy projects, which led to difficulties in reaching an agreement." The Democratic Party's position is to increase the central government's share in consideration of the financial difficulties faced by local governments due to repeated tax revenue shortfalls, while the People Power Party suggested allocating the funds to projects other than consumer coupons.
There is still a possibility that the two parties may seek a compromise. However, opposition from the Democratic Party regarding the presidential office's special activity funds remains a variable. The two parties had originally planned a meeting between their respective policy chiefs, but this was postponed due to the breakdown of supplementary budget negotiations.
The supplementary budget is expected to be finalized at around 32.5 trillion won, an increase of about 2 trillion won from the 30.5 trillion won submitted by the government. The Democratic Party had previously announced plans to provide an additional 30,000 won for non-metropolitan areas and 50,000 won for regions at risk of depopulation as part of the core project of this supplementary budget, the livelihood recovery consumer coupon. The final budget size will be determined after reflecting increases made during the National Assembly’s review process.
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