Next Year's 728 Trillion Won Expansionary Budget: Ruling Party Calls It "Priming Water" for Economic Recovery, Opposition Criticizes "Reckless Fiscal Management"

Clear Divide Between Ruling and Opposition Parties Over Expansionary Fiscal Policy
Opposition Criticizes Restoration of Special Activity Expenses as "Hypocrisy"

The ruling and opposition parties have shown completely different perspectives regarding the budget proposal for next year, which features an expansionary fiscal policy with a total scale of 728 trillion won. The Democratic Party of Korea gave a positive assessment, calling it a "priming water" for economic and livelihood recovery, while the People Power Party criticized it as "reckless fiscal management."

Regarding the government's release of next year's budget proposal on the 29th, the Democratic Party evaluated it as "a budget that maintains an active fiscal stance while also considering fiscal sustainability." The Democratic Party's Policy Committee stated, "A budget drafted with fiscal austerity during an economic downturn does not significantly contribute to economic growth nor lead to increased tax revenue, which could actually undermine fiscal soundness." The committee added, "At this time, we need to shift our thinking and pursue an active fiscal policy to revive the economy, increase tax revenue, and thereby create a virtuous fiscal cycle that expands fiscal capacity."

Regarding the 27 trillion won expenditure restructuring, the Democratic Party commented, "It is significant in that the government has demonstrated its commitment to minimizing the scale of government bond issuance." In particular, the party viewed the government's plan to disclose the details of expenditure restructuring as "a meaningful first step toward greater transparency in fiscal information in the Republic of Korea, where the people are the true owners."

Additionally, the Democratic Party praised the budget for responding to the economic situation and for allocating the research and development (R&D) budget at the highest growth rate ever.

The People Power Party strongly criticized the expansionary fiscal stance. Song Eonseok, floor leader of the People Power Party, said, "The government is managing fiscal operations far too recklessly," adding, "This year, a 30 trillion won supplementary budget was used to distribute consumption coupons, but the growth rate is still below 2%." He pointed out, "While revenue is decreasing, expenditures are increasing, and as a result, national debt is expected to rise by more than 100 trillion won." He stated, "This is putting national finances under a mountain of debt," and expressed regret over what he described as "reckless fiscal management."

In particular, the People Power Party pointed out that the government's budget proposal includes special activity funds of 8.3 billion won, 3.2 billion won, and 1.5 billion won allocated to the Presidential Office, the police, and the Board of Audit and Inspection, respectively. Choi Boyoon, chief spokesperson of the People Power Party, noted that the Democratic Party had completely cut the special activity fund budget during last year's budget review, and criticized, "As soon as they took power, they changed their stance, drafted a supplementary budget to partially restore the special activity funds, and now, in next year's budget proposal, they have restored the special activity funds for the Presidential Office, police, and Board of Audit and Inspection to the previous year's levels as if nothing happened." He added, "This goes beyond hypocrisy and is shameless duplicity, deceiving the people."

Regarding this, Chief Spokesperson Choi stated, "The Democratic Party should kneel before the people and apologize for last year's political show of completely cutting the special activity funds," adding, "Even now, instead of wielding these funds arbitrarily to suit the administration's needs, they must be executed transparently through institutional reforms in a way that the public can accept."