Ruling and Opposition Parties Resolve Differences on Disaster Relief Fund... Supplementary Budget Review to Begin from the 27th (Comprehensive)

Lee In-young, floor leader of the Democratic Party of Korea, is attending the Supreme Council meeting held at the National Assembly on the 24th and delivering an opening remark. Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Kang Nahum] A green light has been given for the passage of the second supplementary budget bill to provide emergency disaster relief funds to all citizens. On the 26th, the ruling and opposition parties agreed to secure the additional 1 trillion won budget not through government bond issuance but through expenditure adjustments. Accordingly, both parties plan to activate the standing committees from the 27th and begin a full review of the supplementary budget bill.

Lee In-young, the floor leader of the Democratic Party of Korea, said at a press briefing held at the National Assembly on the same day, "If expenditure adjustments equivalent to the 1 trillion won that was to be borne by local governments are made, the standing committees can operate normally, and the Budget and Accounts Committee can also be activated. This was the gist of discussions I had with Shim Jae-cheol, acting leader of the United Future Party, yesterday and today."

Lee added, "Shim floor leader requested that even if the 1 trillion won, which local governments were supposed to share but the central government ended up bearing, could be additionally provided through expenditure adjustments, it would reduce the burden of government bonds. So, I called the Ministry of Economy and Finance official today to discuss whether this was possible, and it was finally agreed to be feasible."

Shim Jae-cheol, acting leader of the United Future Party, who also held a press briefing at the National Assembly on the same day, said, "We believe that resources should be secured through restructuring the existing budget rather than deficit bond issuance," and added, "We hope that the ruling party and government absorb at least 1 trillion won of the additional budget through budget reallocation."

He said, "If the 1 trillion won expenditure adjustment is made, our United Future Party will activate the standing committees from tomorrow to review the supplementary budget bill," and "The Budget and Accounts Committee will naturally be activated after the standing committee budget review."

Sim Jae-cheol, floor leader of the United Future Party, and Kim Jae-won, chairman of the Policy Committee, are giving a briefing after a closed supreme council meeting at the National Assembly on the 24th. Photo by Yoon Dong-joo doso7@

Initially, the government set the budget at 9.7 trillion won, including 2.1 trillion won in local government funds, based on payments to the bottom 70% income bracket, and submitted a second supplementary budget bill worth 7.6 trillion won to the National Assembly. However, as the ruling party and government expanded the payment target to all citizens, the required budget increased to 14.3 trillion won.

The ruling and opposition parties had disagreements over whether the increased required budget should be additionally borne by local governments or financed through government bond issuance. The ruling party and government announced that out of the additional 4.6 trillion won needed, 3.6 trillion won would be covered by bond issuance and 1 trillion won by local government funds, but the United Future Party criticized the additional bond issuance as "preparing for a debt party" and demanded expenditure budget adjustments. After several days of tug-of-war, both parties reached a consensus to secure the 1 trillion won local government share through expenditure adjustments.

With the contentious issue resolved, the passage of the second supplementary budget bill in the National Assembly is expected to gain momentum. The Democratic Party hopes to pass the bill at the plenary session on the 29th. However, since the United Future Party plans to closely scrutinize how the expenditure adjustments are made, it is uncertain whether the supplementary budget will be completed within this month as the Democratic Party aims.

For now, both parties plan to agree on the legislative schedule through a meeting between their chief floor negotiators. It is reported that Yoon Hoo-duk, deputy floor leader of the Democratic Party, and Kim Han-pyo, deputy floor leader of the United Future Party, are coordinating the meeting schedule.

Meanwhile, regarding the inducement of donations from high-income earners, the ruling party plans to submit a special law related to donations to the National Assembly’s Public Administration and Security Committee as a member’s bill on the 27th. Yoon Hoo-duk, deputy floor leader of the Democratic Party, said, "The draft was reviewed last Friday (the 24th), and it will be submitted as a member’s bill on Monday (the 27th). The amendment to the Restriction of Special Taxation Act for a 15% tax reduction will also be proposed on Monday."

This content was produced with the assistance of AI translation services.