[2021 Budget] 56.7 Trillion Won for SOC, Green New Deal, and Housing Safety Net

[Asia Economy Reporter Yoo In-ho] The Ministry of Land, Infrastructure and Transport will focus its budget on social overhead capital (SOC) such as road construction, the Green New Deal, and strengthening the housing safety net to revitalize the domestic economy affected by the novel coronavirus disease (COVID-19) next year.

The Ministry of Land, Infrastructure and Transport announced on the 1st that it has prepared the budget for next year at 56.7 trillion won, an increase of 6.6 trillion won (13.2%) compared to this year.

The budget increased by 2.6 trillion won (12.9%) to 23.1 trillion won compared to the previous year. The fund increased by 4 trillion won (13.3%) to 33.6 trillion won compared to the previous year.

When preparing next year’s budget, the Ministry explained that it increased investments such as overcoming the crisis and preparing for the future (1.1 trillion won), strengthening national land and transportation safety for public reassurance (1 trillion won), and revitalizing regional vitality (1.9 trillion won). In addition, the housing benefit budget was increased by 400 billion won so that vulnerable groups do not face difficulties in housing, and the Housing and Urban Fund was increased by 4 trillion won each to support financing for actual homebuyers without housing and to ensure smooth supply of rental housing.

In particular, the government’s total SOC budget for next year increased by 12.4% to 21.0403 trillion won from 18.7171 trillion won this year. Among SOC, the budget for national land and regional development increased the most. It reached 3.5908 trillion won, an increase of 36.0% compared to this year. Budgets were allocated for regions and cities (2.3845 trillion won), water resources (810.7 billion won), and industrial complexes (395.6 billion won).

The SOC transportation budget reached 17.4495 trillion won, an increase of 8.5% compared to this year. Among them, to support the aviation industry struggling due to COVID-19, the aviation and airport budget was set at 351.8 billion won, an increase of 30.7% compared to this year.

Additionally, the SOC digitalization budget for smart investments to improve the accuracy of ‘management’ and ‘prediction’ of existing infrastructure was set at 1.4974 trillion won, nearly double the 814 billion won of this year.

However, the construction industry points out that the SOC budget level is somewhat insufficient to revive the sluggish domestic economy.

The Ministry of Land, Infrastructure and Transport also significantly expanded the budget to actively promote the Korean New Deal project. Next year’s Korean New Deal project budget was set at 2.4 trillion won, double the 1.2 trillion won this year.

In particular, the budget for the Green Remodeling project was expanded to respond to climate change and foster the eco-friendly construction industry and jobs. Next year, the project will be promoted targeting 1,085 public buildings such as national and public daycare centers, health centers, and medical institutions (227.6 billion won), and 82,000 public rental housing units (354.5 billion won).

The budget to strengthen the housing safety net for vulnerable groups was also set at 2.1 trillion won, an increase of 400 billion won compared to this year. This is an expanded budget mainly focused on housing benefits to support vulnerable groups suffering from economic downturn due to COVID-19.

The housing benefit was prepared at 1.9879 trillion won, an increase of 21.8% compared to this year, in preparation for an increase in recipients. To smoothly achieve the housing welfare roadmap, fund investment for supplying 220,000 public housing units next year was increased from 16.6 trillion won this year to 19.1 trillion won.

Jung Kyung-hoon, Director General of the Ministry of Land, Infrastructure and Transport, said, “In this severe crisis caused by COVID-19, public finance needs to demonstrate active leadership to overcome it,” and added, “In 2021, by strengthening responses in areas that the nation must protect such as the regional economy, public safety, and social safety nets, we will overcome the current crisis and prepare for the future.”

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