'Why Cut the Budget for Public and National Daycare Centers?'... The National Audit Becomes a 'Preliminary Battle' of the Budget Season

Repeated Budget Criticisms for Next Year... Early Alert on Constituency or Interest Budgets
Opposition: "Pointing Out Unfairness of Budget Cuts Through National Audit"

[Asia Economy Reporter Naju-seok] Ahead of the full-scale budget review, the National Assembly inspection is becoming a preliminary battle for the budget war. Lawmakers have effectively started the budget war by pointing out issues with the Yoon Seok-yeol administration's budget formulation for next year through the inspection. This is interpreted as a move to alert the government in advance about the budget for their constituencies or projects of interest.

[Image source=Yonhap News]

According to the National Assembly on the 15th, opposition party lawmakers pinpointed problems in the formulation of next year's budget through the National Assembly inspection.

Jeon Hye-sook, a member of the Democratic Party of Korea, raised concerns about the budget for the "Expansion of Childcare Centers" project, related to the construction of new national and public daycare centers for next year, which was cut from 60.93 billion won this year to 49.17 billion won, a reduction of 11.733 billion won. The "Childcare Center Function Enhancement" project, which supports the expansion, reconstruction, and renovation of existing daycare centers, was also reduced from 3.859 billion won to 3.473 billion won, a decrease of 386 million won. Jeon criticized, "It is the first time in the past five years that the budget for establishing national and public daycare centers, which are highly preferred by parents, has fallen below 60 billion won."

Park Young-soon, a Democratic Party lawmaker, pointed out the issue of budget cuts for the smart factory dissemination project. Park stated, "The Ministry of SMEs and Startups' budget for smart factory establishment and advancement projects has been slashed from 319.2 billion won this year to 105.7 billion won next year, reduced to one-third," adding, "It is hard to understand why the ministry would drastically reduce the scale of such projects instead of expanding them." He emphasized the necessity of the project by saying, "Small and medium-sized enterprises that have introduced smart factories have shown clear improvements in productivity, quality, cost reduction, and delivery compliance," and "While employment and sales have increased, industrial accidents have decreased, leading many SMEs to hope for the introduction of smart factories."

There were also criticisms regarding the reduction of the Youth Employee Deduction Project. Yang Yi-won-young, a Democratic Party lawmaker, explained, "The Youth Employee Tomorrow Deduction is a project aimed at alleviating manpower shortages in SMEs and asset formation for youth, where youth workers employed for more than six months at SMEs and mid-sized companies jointly accumulate deductions with youth (1), companies (1.7), and the government (1.5), and upon maturity after five years, 30 million won is paid to the youth worker. Youth employees pay 120,000 won monthly, companies contribute 200,000 won, and the government pays 180,000 won," adding, "It is a project with high satisfaction among both SMEs and youth." Yang criticized, "In the budget formulation process for next year, this project was drastically reduced in duration to 2 years (from 5 to 3 years), support targets to 30,000 people (from 40,000 to 10,000), accumulated funds to 12 million won (from 30 million to 18 million), and the budget to a whopping 258.6 billion won (from 275 billion to 16.4 billion)."

Kim Jeong-ho, a Democratic Party lawmaker, introduced an analysis of next year's government budget plan for the "Support Plan for SMEs' Carbon Neutral Response" established by the Ministry of SMEs and Startups, revealing that among 16 projects, 6 were reduced compared to the previous year, and 6 were cut compared to the ministry's requested amount. Kim introduced projects with significant budget cuts compared to the previous year, such as the "Green New Deal Promising Companies 100" project (cut by 8.5 billion won) and the "SME Innovation Voucher (Carbon Neutral Management Innovation Voucher)" project (cut by 5.4 billion won). Regarding this, he criticized, "The sincerity of the Yoon Seok-yeol government's support for carbon neutrality is questionable, and if carbon neutrality is viewed politically, it shows a lack of awareness of the era of climate crisis response and major transformation."

Voices also emerged pointing out problems with the overall budget policy direction beyond specific projects.

Kim Min-seok, a Democratic Party lawmaker, pointed out, "According to the next year's budget plan recently disclosed by the Yoon Seok-yeol government, the budget for health, welfare, and employment sectors increased by 9.3 trillion won to about 227 trillion won," adding, "Even looking at the year-on-year growth rate, the Yoon Seok-yeol government's budget for health, welfare, and employment sectors records the lowest growth rate since 2010."

In particular, Kim emphasized, "Over the past five years (2018-2022), the health and welfare budget growth rate based on the main budget was 11.5%, almost similar to next year's growth rate (11.8%), but the public pension growth rate was 18.0% (31.4921 trillion won → 37.159 trillion won), so it cannot be said that the Ministry of Health and Welfare's budget has increased in terms of real welfare (social welfare for vulnerable groups)." He expressed concern, saying, "With forecasts that unprecedented complex crises will continue until next year, looking at next year's budget details, it is questionable whether this level can protect the vulnerable groups in our society."

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