Rival parties settle deal on 2026 budget, clear way for Nat'l Assembly to pass it Tuesday

People Power Party floor leader Rep. Song Eon-seog, left, and Democratic Party of Korea floor leader Rep. Kim Byung-kee take a commemorative photo after signing an agreement to the 2026 budget plan at the National Assembly, Seoul, Tuesday. Joint Press Corps

Rival parties have reached a last-minute deal on next year's national budget and agreed to pass it through the National Assembly on Tuesday, clearing the way for lawmakers to approve an annual budget bill within the legal deadline for the first time in five years.

The ruling Democratic Party of Korea and the main opposition People Power Party reached the agreement during a meeting of their floor leaders earlier in the day and decided to hold a plenary session at 4 p.m. to put the budget bill to a vote.

The government's 728 trillion-won ($498 billion) budget proposal for 2026 had been pending in parliament as the two sides sought to narrow differences on key items, including funding for local gift certificate programs.

The two sides agreed to cut 4.3 trillion won from the government's proposal and reallocate the same amount to other programs, leaving the total budget unchanged from the initial plan.

Key budget items related to President Lee Jae Myung's signature initiatives, including local gift certificate programs, will be kept at the proposed level. Instead, partial cuts will be made to certain artificial intelligence-related programs and policy funds.

The parties also agreed to increase funding for other areas, including establishing a disaster-recovery system following a massive fire at a state data center, as well as expanding national scholarships.

If the budget passes the plenary session, it will mark the first time in five years that the National Assembly has met the legal deadline for budget approval. The legal deadline is midnight of Dec. 2.