[Deputy Prime Minister for Science and Technology Launch]③"Budgetary Authority Is Key to Effectiveness"

Without Real Authority Over Allocation and Coordination,
the Deputy Prime Minister Title Is Merely Symbolic
Fluctuating R&D Growth Rates Highlight the Need for Fiscal Rules
Proposals for an R&D Contingency Fund and a Dedicated Standing Committee

There is a growing consensus that for the Deputy Prime Minister for Science and Technology to be effective, budgetary authority is essential. Concerns have been raised that even if the position is elevated to Deputy Prime Minister, it may lack real power without substantive authority. In particular, regarding next year’s national research and development (R&D) budget of 35.3 trillion won, even if the Deputy Prime Minister for Science and Technology plays a ‘coordinating’ role, the final authority to ‘allocate’ the budget still remains with the Ministry of Economy and Finance. Experts point out that “transferring budget allocation authority is realistically difficult,” but also stress that “if even the authority to distribute and coordinate is not clearly guaranteed, the Deputy Prime Minister system will lose its effectiveness.”

The key issue is empowering the authority to distribute and coordinate. Traditionally, each ministry submits its budget request at the end of May. The Office for Innovation and the National Science and Technology Advisory Council then finalize the R&D allocation plan by June 30 and forward it to the Ministry of Economy and Finance, which confirms the government’s proposal at the end of August and submits it to the National Assembly. The problem with this structure is that the review period is excessively short, and since the Ministry of Economy and Finance sets a ‘ceiling’ for each ministry in advance, the power to coordinate is concentrated in the fiscal authorities.

The Presidential Transition Committee considered extending the review period of the Office for Innovation to mid-August and expanding the scope from ‘major R&D’ to ‘all R&D.’ However, unless the relevant laws are amended, it will be difficult to make significant changes to next year’s budget planning. Ultimately, the top priority is to legally establish the authority of the Ministry of Science and ICT to distribute and coordinate the total R&D budget and to end the practice of pre-assigning ceilings to each ministry. The proposal is to change the structure so that the Ministry of Science and ICT first allocates the total R&D budget by ministry, and the Ministry of Economy and Finance respects this allocation when formulating the budget proposal. The idea is to guarantee authority by law while also creating a system in which the Deputy Prime Minister for Science and Technology can take the lead in actual operations. Former Vice Minister of Science and ICT Oh Taeseok pointed out, “The power to coordinate policy comes from the ability to ‘add or remove’ budget items,” and added, “If you cannot move the budget, you are not a real control tower.”

Legislative improvements are already underway. A proposed amendment to the Framework Act on Science and Technology, sponsored by Assemblywoman Hwang Jeonga, who served on the second economic subcommittee of the Presidential Transition Committee, includes a provision stating that “at least 5% of total government expenditure should be spent on R&D.” However, there are concerns that such a ‘rigid regulation’ enshrined in law could make policy adjustments difficult in response to changing circumstances. What matters more than numbers are social consensus, predictability, and the governance structure to support them.

There is also a proposal to create a separate ‘R&D contingency fund’ that the Deputy Prime Minister could execute at their own discretion. Given the high level of uncertainty in research fields, the logic is that the Deputy Prime Minister should directly control a fund that can be immediately deployed for ‘emerging technologies’ or urgent issues.

The stability of the budget has also emerged as a key issue. Park Chansu, Vice President of the Science and Technology Policy Institute, noted, “According to the National Fiscal Management Plan, the annual growth rate of the R&D budget rose from 2.6% to 10.6%, but for 2024-2026, it is expected to fall back to around 5.5%, showing significant fluctuations.” He added, “Since R&D is an investment in the nation’s future, it should be stably allocated according to fiscal rules linked to total government expenditure. Only then can the Deputy Prime Minister’s distribution and coordination be effective.”

According to experts in the science and technology field, science and technology agenda items have consistently been pushed aside in parliamentary standing committees in favor of broadcasting and communications issues, resulting in a lack of proper discussion. The same applies to budget reviews. With this structure, it is difficult to ensure consistency and predictability in operations.

As a result, there are discussions about establishing a separate standing committee dedicated solely to science and technology, which would prioritize major R&D agenda items for review. This would allow budget deliberations to proceed without being swayed by political issues and would ensure stability from a mid- to long-term perspective.

At the forum “Establishment of the Deputy Prime Minister for Science and Technology: Roles and Challenges for Technology-Led Growth,” held on September 23, former Minister of Science and ICT Yoo Sangim stated, “It was shocking that not a single graphics processing unit (GPU) was included in the initial AI budget of 1.8 trillion won.” He added, “In the end, we secured over 1 trillion won in additional funding through a supplementary budget to include the GPU budget, but this situation arose due to silos between ministries and the absence of a control tower.” Data centers are overseen by the Ministry of Land, Infrastructure and Transport, power supply by the Ministry of Trade, Industry and Energy, workforce training by the Ministry of Education, and GPUs by the Ministry of Science and ICT. Without a system to bring these elements together and make prompt decisions, the absurd situation of omitting GPUs from a 1.8 trillion won budget will continue to occur.