Government Still Reluctant to Approve ROK New Year Supplementary Budget Request

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[Asia Economy Reporter Joo Sang-don] Regarding the two-week extension of the current social distancing measures, the ruling party's demand for the preparation of an additional supplementary budget for the new year is reportedly still met with reluctance by the government.

According to a government official on the 2nd, the Ministry of Economy and Finance, which is in charge of fiscal affairs, is known not to be considering a separate supplementary budget at this time.

Previously, on December 31 last year, Lee Jae-myung, the Democratic Party presidential candidate, called for a supplementary budget of at least 25 trillion won, and Yoon Ho-jung, the party's floor leader, urged more proactive measures including a supplementary budget, but the government's stance has not changed yet.

Prime Minister Kim Boo-kyum appeared on KBS News on the 1st and responded to the host's question, "Do you agree with the supplementary budget?" by saying, "This issue could be controversial as a populist move ahead of the election, so this should be handled by the National Assembly (...)."

However, Prime Minister Kim added, "If the ruling and opposition parties say, 'Let's help these people (small business owners and self-employed) even if we have to borrow money,' then discussions will proceed quickly."

The government has already allocated 3.9 trillion won in contingency funds this year. If 1 to 2 trillion won is spent during the process of expanding the quarantine support funds and compensation for losses, 1.9 to 2.9 trillion won remains. After deducting several hundred billion won worth of security contingency funds, the amount of money the fiscal authorities can use going forward is not very large.

There is also the possibility that additional support measures will need to be implemented under the current distancing level or that fiscal input beyond the fund and contingency resources will be required if distancing is extended. However, within the fiscal authorities, there is a gag order regarding the scale of contingency funds currently held. The plan is to maintain contingency funds above a certain level by maximizing the use of the existing budget reallocations and fund resources to respond to any unforeseen situations.

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