821 Trillion Won Budget Review Kicks Off; Ruling Party Pushes Hikes in Livelihood Spending, Sparking Clash Over Future Response Fund

Ruling party seeks more spending on jobs, housing and other livelihood measures
Opposition calls for 104 trillion won cut to Future Response Fund

The Democratic Party of Korea is pushing to increase spending on people’s livelihoods as it begins reviewing next year’s 820.9 trillion won budget. The People Power Party is calling for cuts to the 162.3 trillion won Future Response Fund, setting the stage for a partisan showdown.

According to political circles on Nov. 2, the review of the 2027 budget has begun in earnest following President Lee Jae-myung’s address to the National Assembly on the budget. The government’s proposal, at 820.9 trillion won, is a record high, up 93 trillion won, or 12.8%, from this year’s main budget of 727.9 trillion won.

A public hearing on the budget bill and fund management plan held by the National Assembly's Special Committee on Budget and Accounts. Yonhap News

The Democratic Party plans to maintain the government budget proposal’s overall direction while increasing spending on people’s livelihoods, including support for jobs, housing, low-income households’ finances, and small business owners. It is also discussing additional allocations for local government grants and local education finance grants, as well as expanding central government funding for fire services.

The main point of contention is the Future Response Fund, which will use additional tax revenue from the semiconductor boom. The Democratic Party says the fund will provide resources for future investment in areas such as artificial intelligence (AI), young people, and local communities. Speaking to reporters after a closed-door meeting of the party’s Supreme Council on Nov. 2, Park Sung-joon, the party’s senior spokesperson, said in response to the People Power Party’s call for cuts, “We plan to counter by presenting specific projects that support people’s livelihoods.”

The People Power Party argues that 104.4 trillion won in the fund’s surplus should be cut and used to repay the national debt. The Rebuilding Korea Party supports the purpose of establishing the fund but voiced concerns that local and education finances could be weakened.

Democratic Party members of the National Assembly’s Special Committee on Budget and Accounts will hold a workshop on Nov. 3 to discuss their budget review strategy. The committee will hold comprehensive policy questioning on Nov. 4-5, review individual ministries’ budgets from Nov. 9-12, and begin operating its Budget Bill Coordination Subcommittee on Nov. 16. The statutory deadline for passing the budget is Dec. 2.

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