Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
National budget weaponized amid political strife
Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok enters the National Assembly in Yeouido, Seoul, Tuesday. Yonhap
By Yi Whan-woo
Next year's national budget, worth hundreds of trillions of won, has become a point of contention between the government and rival parties as Korea experiences an extremely polarized political environment.
On Tuesday, the main opposition Democratic Party of Korea (DPK), which holds a majority in the National Assembly, leveraged its position to singlehandedly pass a bill that reduces the 2025 budget by 4.1 trillion won to 677.4 trillion won ($485.3 billion).
The reduced expenses were the government's reserve funds, and the special activity expenses of the presidential office's secretariat, the national security office, the state audit agency, the prosecution and the police.
The DPK downsized the budget bill, arguing that no previous administrations required such an amount, thereby making it unnecessary.
The party strongly advocated for its stance as President Yoon Suk Yeol faces impeachment following an ill-fated attempt to impose martial law.
The measure came as the government has already been reducing spending for years in a bid to curb the snowballing national debt.
Under the circumstances, the ruling People Power Party (PPP) and the Ministry of Economy and Finance had been calling for approval of the original bill.
The finance ministry said the downsized bill will result in “a grave situation concerning the public's livelihood, public order and security, diplomacy and disaster relief.”
In particular, Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok said finalizing the bill through bipartisan agreement was necessary to “maintain external credibility and ensure economic stability.”
The DPK, however, insisted on keeping the revised bill, noting that the presidential office is unlikely to return to normal operations for the time being.
“For instance, the president has a slim chance to go on official visits and any relevant spending will be redundant,” it said.
“We can discuss allocating supplementary spending when state affairs return to normal,” the party added, implicitly referring to the prospects of Yoon’s impeachment and the beginning of a new government.
The party additionally wanted to cut 700 billion won related to presidential bodyguards and projects to be carried out by the presidential office. However, it dropped the plan as it was concerned that “cutting too much expenses would backfire against the party.”
Shin Yul, a political science professor at Myongji University, said that the DPK “is wielding its majority-holding power excessively to press the government.”
“Under the circumstances, a national budget can be an effective tool as the government needs to comply for state affairs to go on.”
Meanwhile, the DPK separately wants to earmark 2 trillion won for the issuance of local currency vouchers, a move designed to help small merchants and the self-employed. The plan is in line with the signature policy of its leader, Rep. Lee Jae-myung.