The Korea Times
amn_close.png
amn_bl.png
National
  • Politics
  • Foreign Affairs
  • Multicultural Community
  • Defense
  • Environment & Animals
  • Law & Crime
  • Society
  • Health & Science
amn_bl.png
Business
  • Tech
  • Bio
  • Companies
  • World Expo 2030
amn_bl.png
Finance
  • Companies
  • Economy
  • Markets
  • Cryptocurrency
amn_bl.png
Opinion
  • Editorial
  • Columns
  • Thoughts of the Times
  • Cartoon
  • Today in History
  • Blogs
  • Tribune Service
  • Blondie & Garfield
  • Letter to the Editor
amn_bl.png
Lifestyle
  • Travel & Food
  • Trends
  • People & Events
  • Books
  • Around Town
  • Fortune Telling
amn_bl.png
Entertainment & Arts
  • K-pop
  • Films
  • Shows & Dramas
  • Music
  • Theater & Others
amn_bl.png
Sports
  • Hangzhou Asian Games
amn_bl.png
World
  • SCMP
  • Asia
amn_bl.png
Video
  • Korean Storytellers
  • POPKORN
  • Culture
  • People
  • News
amn_bl.png
Photos
  • Photo News
  • Darkroom
amn_NK.png amn_DR.png amn_LK.png amn_LE.png
  • bt_fb_on_2022.svgbt_fb_over_2022.svg
  • bt_twitter_on_2022.svgbt_twitter_over_2022.svg
  • bt_youtube_on_2022.svgbt_youtube_over_2022.svg
  • bt_instagram_on_2022.svgbt_instagram_over_2022.svg
The Korea Times
amn_close.png
amn_bl.png
National
  • Politics
  • Foreign Affairs
  • Multicultural Community
  • Defense
  • Environment & Animals
  • Law & Crime
  • Society
  • Health & Science
amn_bl.png
Business
  • Tech
  • Bio
  • Companies
  • World Expo 2030
amn_bl.png
Finance
  • Companies
  • Economy
  • Markets
  • Cryptocurrency
amn_bl.png
Opinion
  • Editorial
  • Columns
  • Thoughts of the Times
  • Cartoon
  • Today in History
  • Blogs
  • Tribune Service
  • Blondie & Garfield
  • Letter to the Editor
amn_bl.png
Lifestyle
  • Travel & Food
  • Trends
  • People & Events
  • Books
  • Around Town
  • Fortune Telling
amn_bl.png
Entertainment & Arts
  • K-pop
  • Films
  • Shows & Dramas
  • Music
  • Theater & Others
amn_bl.png
Sports
  • Hangzhou Asian Games
amn_bl.png
World
  • SCMP
  • Asia
amn_bl.png
Video
  • Korean Storytellers
  • POPKORN
  • Culture
  • People
  • News
amn_bl.png
Photos
  • Photo News
  • Darkroom
amn_NK.png amn_DR.png amn_LK.png amn_LE.png
  • bt_fb_on_2022.svgbt_fb_over_2022.svg
  • bt_twitter_on_2022.svgbt_twitter_over_2022.svg
  • bt_youtube_on_2022.svgbt_youtube_over_2022.svg
  • bt_instagram_on_2022.svgbt_instagram_over_2022.svg
  • Login
  • Register
  • Login
  • Register
  • The Korea Times
  • search
  • all menu
  • Login
  • Subscribe
  • Photos
  • Video
  • World
  • Sports
  • Opinion
  • Entertainment & Art
  • Lifestyle
  • Finance
  • Business
  • National
  • North Korea
  • 1

    BTS' Jungkook to drop 2nd solo single

  • 3

    Korea wins gold in League of Legends competition; Faker tops podium

  • 5

    VIDEOBustling Chuseok: Namsan Hanok Village immerses visitors in Korea's rich traditions

  • 7

    Pentagon's CWMD strategy document calls N. Korea 'persistent threat'

  • 9

    Are 'finfluencers' helping or harming investment community?

  • 11

    Yoon hosts Chuseok luncheon for Korean atomic bomb victims in Hiroshima

  • 13

    Apple, China met to discuss Beijing's crackdown on western apps: WSJ

  • 15

    Poll shows 79% of young Koreans agree on need to improve ties with Japan

  • 17

    Second release of Fukushima wastewater to start next week

  • 19

    S. Korea cruises past N. Korea in women's basketball

  • 2

    PHOTOSTrapped along borders

  • 4

    Trailblazing nonagenarian artist honored for redefining Korean fiber art

  • 6

    Opposition leader Lee again proposes talks with President Yoon

  • 8

    BTS' Jungkook drops 2nd solo single

  • 10

    Builders vie for leadership in modular construction

  • 12

    Korea fails to be included on FTSE Russell's global bond index

  • 14

    Swimmer Kim Woo-min captures 3rd gold in Hangzhou

  • 16

    INTERVIEW'Coexistence of different art hubs across Asia is necessary': Art Week Tokyo Director

  • 18

    My left arm: how right-handed shooter won Asiad medal with left hand

  • 20

    S. Korea eliminates N. Korea in women's table tennis doubles

Close scrollclosebutton

Close for 24 hours

Open
  • The Korea Times
  • search
  • all menu
  • Login
  • Subscribe
  • Photos
  • Video
  • World
  • Sports
  • Opinion
  • Entertainment & Art
  • Lifestyle
  • Finance
  • Business
  • National
  • North Korea
Finance
  • Companies
  • Economy
  • Markets
  • Cryptocurrency
Sun, October 1, 2023 | 15:19
Policies
Gov't draws up record W429 trillion budget
Posted : 2017-08-29 16:46
Updated : 2017-08-30 09:56
Yoon Ja-young
Print PreviewPrint Preview
Font Size UpFont Size Up
Font Size DownFont Size Down
  • facebook
  • twitter
  • kakaolink
  • whatsapp
  • reddit
  • mailto
  • link
Moon administration to cut SOC spending to bolster welfare

By Yoon Ja-young

The government has proposed its 2018 budget at 429 trillion won ($381 billion), the largest ever, expanding spending on welfare and education and slashing it for social overhead capital (SOC). This is a 7.1 percent increase from this year.

Finance Minister Kim Dong-yeon said Tuesday that the expansionary and aggressive budget was necessary to back up presidential pledges and induce a paradigm shift in growth strategy.

"If we can cut mid- to long-term costs through the paradigm shift, the government should spend money only when it is necessary," he said. The finance and deputy prime minister added that an active role in financial policy matters more than fiscal soundness.

Included in the budget is 18.7 trillion won to support the Moon Jae-in administration's pledges, which will cost 178 trillion won over the next five years.

It includes a 100,000 won monthly allowance for parents of children up to the age of five, and 1.2 trillion won for free childcare. Spending on support for SMEs employing young people and the creation of 15,000 government jobs are also included.

The government also allocated 1.7 trillion won to raise the basic monthly pension for senior citizens; 2.5 trillion won to provide public rental homes; and 100 billion won to set up infrastructure to take care of dementia patients.

The finance ministry explained that it focused on job creation, income-led and innovative growth, safety and human resources development in the budget allocation.

As a result, welfare, labor and education spending will increase, while a smaller amount of money will be allocated for SOC and culture.

The government allocated 146.2 trillion won for welfare, up 12.9 percent from this year, and making up 34 percent of the total budget, the highest ever.

"Structural problems such as low growth and polarization are hindering the working class from enjoying better lives. Fiscal policy should take a leading role to set up a virtuous circle of jobs, distribution and growth," the minister said.

The government allocated 19.2 trillion won for job creation, which is the top priority for the Moon administration. It also set aside 64.1 trillion won for education, up 11.7 percent from this year. The budget for national defense increased 6.9 percent to reach 43.1 trillion won amid growing North Korean threats.

The government, meanwhile, slimmed down tax expenditures by 11.5 trillion won, mostly from sectors that are not priorities in Moon's policies.

The spending for SOC, was cut by 20 percent to 17.7 trillion won. The budget for culture, sports and tourism, which snowballed during former President Park Geun-hye's administration, was also cut by 8.2 percent to 6.3 trillion won.

Total revenue is expected to be 447.1 trillion won, up 7.9 percent from this year.

This includes 268.2 trillion won in tax revenue, which is expected to increase by 10.7 percent from this year on improving corporate performance and a tax hike on the affluent.

Some experts, however, pointed out that the estimate seems to be too optimistic.

"The government's outlook on the economy in the mid to long term may be too optimistic. While growth is slowing because of the decreasing working age population, the government plan is based on estimates that the economy will recover. The tax revenue may fall short of expectations and it may need to increase taxes," said Lee Geun-tae, an economist at the LG Economic Research Institute.

While the budget reflects the income-led growth plan of the Moon administration, Lee said it remains to be seen whether it will be successful.

"The government slashed the SOC budget, but Korea still lacks infrastructure for leisure and culture, which should be bolstered so that people can spend their income, which would lead to the virtuous circle of income-led growth," he added.

Government debt is expected to reach 708.9 trillion won, up 39 trillion won from this year and surpassing 700 trillion won for the first time. But the ratio of debt to GDP will go down from 39.6 percent this year to 39.5 percent.

"Despite increasing spending, the increase in tax revenue and restructuring in expenditure will improve the debt ratio," said Koo Yun-cheol, the director heading the budget office at the finance ministry.

The debt to GDP ratio is expected to surpass 40 percent in 2020, with debt reaching 800 trillion won in 2021.

The government's budget will be submitted to the National Assembly for approval, Sept. 1.

Emailyjy@ktimes.com Article ListMore articles by this reporter
 
miguel
wooribank
LG
Top 10 Stories
1[INTERVIEW] Risk-averse culture is forcing daring creators to flee showbiz INTERVIEWRisk-averse culture is forcing daring creators to flee showbiz
2Koreans adapt to soaring food prices Koreans adapt to soaring food prices
3[PHOTOS] Trapped along borders PHOTOSTrapped along borders
4Education ministry prohibits parents from recording classes Education ministry prohibits parents from recording classes
5[VIDEO] Bustling Chuseok: Namsan Hanok Village immerses visitors in Korea's rich traditions VIDEOBustling Chuseok: Namsan Hanok Village immerses visitors in Korea's rich traditions
6Value, consumer goods, financial stocks expected to gain momentum after Chuseok holiday Value, consumer goods, financial stocks expected to gain momentum after Chuseok holiday
7Are 'finfluencers' helping or harming investment community? Are 'finfluencers' helping or harming investment community?
8Builders vie for leadership in modular construction Builders vie for leadership in modular construction
9[INTERVIEW] ROK-US alliance is win-win partnership: KUSAF chief INTERVIEWROK-US alliance is win-win partnership: KUSAF chief
10Over 30,000 protesters march for climate actions Over 30,000 protesters march for climate actions
Top 5 Entertainment News
1[INTERVIEW] 'Coexistence of different art hubs across Asia is necessary': Art Week Tokyo Director INTERVIEW'Coexistence of different art hubs across Asia is necessary': Art Week Tokyo Director
2M+ deputy director discusses Seoul's potential to challenge Hong Kong as Asia's art hub M+ deputy director discusses Seoul's potential to challenge Hong Kong as Asia's art hub
3Trailblazing nonagenarian artist honored for redefining Korean fiber art Trailblazing nonagenarian artist honored for redefining Korean fiber art
4[INTERVIEW] With '30 Days,' Kang Ha-neul finds new level of comfort in acting INTERVIEWWith '30 Days,' Kang Ha-neul finds new level of comfort in acting
5Rwandan artists bring diversity to Seoul's art scene Rwandan artists bring diversity to Seoul's art scene
DARKROOM
  • Turkey-Syria earthquake

    Turkey-Syria earthquake

  • Nepal plane crash

    Nepal plane crash

  • Brazil capital uprising

    Brazil capital uprising

  • Happy New Year 2023

    Happy New Year 2023

  • World Cup 2022 Final - Argentina vs France

    World Cup 2022 Final - Argentina vs France

CEO & Publisher : Oh Young-jin
Digital News Email : webmaster@koreatimes.co.kr
Tel : 02-724-2114
Online newspaper registration No : 서울,아52844
Date of registration : 2020.02.05
Masthead : The Korea Times
Copyright © koreatimes.co.kr. All rights reserved.
  • About Us
  • Introduction
  • History
  • Contact Us
  • Products & Services
  • Subscribe
  • E-paper
  • RSS Service
  • Content Sales
  • Site Map
  • Policy
  • Code of Ethics
  • Ombudsman
  • Privacy Statement
  • Terms of Service
  • Copyright Policy
  • Family Site
  • Hankook Ilbo
  • Dongwha Group