43 Trillion Won for "Youth Budget"... Expanded Despite Poor Execution and Flawed Demand Surveys

Government expands next year's youth budget by 53.5%
Arts Pass budget increased 21-fold despite 27% execution rate
20 billion won for joint AI subscription... Estimates based on highest-priced plan

The government has increased next year's youth budget by 53.5% from a year ago, bringing it to more than 43 trillion won. However, the National Assembly Budget Office has criticized a number of what it called haphazard increases, including a 21-fold increase in the budget for the Youth Culture and Arts Pass, whose execution rate was only in the 20% range, and an allocation of 20 billion won for a joint AI subscription program for university students that assumes the use of the most expensive plan, priced at around 80,000 won, without first surveying demand. Critics have also called the spending a handout budget aimed at boosting support among young people who are turning away from the government, using increased tax revenue from the semiconductor boom.

Yonhap News Agency

95% of pass holders used it, but actual budget execution was 27%

According to the Ministry of Planning and Budget on November 6, the 2027 budget for youth-related programs totals 43.3 trillion won, up 53.5% from this year. At an event called "Unboxing the Youth Budget" last August, President Lee Jae-myung stressed the importance of expanding economic opportunities, saying, "It is the government's responsibility to create a society where young people can obtain opportunities in proportion to their efforts." The National Assembly Budget Office, however, pointed out that assessments of program effectiveness have not kept pace with the rapid expansion of public spending. A key example is the Youth Culture and Arts Pass, which was transferred to the newly established Future Response Fund. The government expanded eligibility from 19- and 20-year-olds (280,000 people) to those aged 19 to 34 (6.43 million people), increasing the budget 21-fold, from 36.1 billion won to 792.5 billion won, a 2,092.6% increase.

The problem is poor budget execution. The Ministry of Culture, Sports and Tourism says 94.5% of pass holders used their cards, but that figure includes anyone who made at least one payment. The average amount spent per young person in the Seoul metropolitan area was 60,647 won, about one-third of the 200,000-won limit. Meanwhile, the execution rate was just 27.2% (11.12 billion won) of the adjusted budget of 40.883 billion won, including carryovers. It was also only 30.8% of the 36.1 billion won allocated for the year. The National Assembly Budget Office said, "Despite continued under-execution and low actual spending, the budget was substantially increased," warning that "a large amount of the budget is likely to go unused."

AI subscription budget assumes the most expensive plan, with no demand survey

The 19.96-billion-won joint AI subscription program for university students has also drawn criticism over flawed demand estimates. The Ministry of Education set the annual subscription fee at about 88,000 won per student, based on the highest-tier paid AI plan, with the government and universities each covering half the cost. However, it assumed that 30% of the country's 2.4 million university students in science and engineering would be intensive users, and estimated actual usage at 60% based on cases at certain universities. The National Assembly Budget Office said, "Not every science and engineering student needs the highest-tier paid service," warning that applying the most expensive plan across the board could waste public funds. The Ministry of Patriots and Veterans Affairs' program to support recently discharged young veterans in obtaining indemnity health insurance has also been criticized for overestimating demand. The ministry budgeted 7.5 billion won for next year, assuming that half of the 178,000 people expected to complete their military service would enroll, and that all of those eligible would sign up. Critics say the government assumed universal enrollment even though participation is voluntary.

1.7 trillion won for youth savings account despite low enrollment, with income limits removed

The Financial Services Commission's Youth Future Savings Account has been cited as an example of a program whose budget was expanded despite falling short of its target. Its budget surged 128.4%, from more than 740 billion won this year to 1.7011 trillion won next year. Yet, of the estimated 3.2 million people eligible for government contributions, only 1.37 million (42.8%) remained enrolled as of August this year. Just over 260,000 people switched from the Youth Leap Account, only 19% of the target of 1.35 million. Despite this, the government plans to eliminate income requirements entirely starting next year, extending support to young people with high incomes. The National Assembly Budget Office called for careful consideration, saying the change could make it harder to focus support on low-income young people and increase the burden on commercial banks to offer preferential interest rates. Kim Seon-kyo, a People Power Party lawmaker on the National Assembly's Special Committee on Budget and Accounts, said, "I will push for major cuts to cash handouts and self-congratulatory spending, where the government uses taxpayers' money to win favor while leaving the public to shoulder the entire burden."

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