By Lee Kap-soo

 

President Yoon Suk-yeol said, "We need to continue our sound fiscal stance to safeguard external confidence and ensure price stability." Presiding over a cabinet meeting on Aug. 29, Yoon said, "The total expenditure for next year is 656.9 trillion won, the lowest increase of 2.8 percent since 2005. We have resolutely rejected the 'fiscal universalism' that the previous government was hooked on, and have firmly shifted to a sound fiscal stance."

 

Specifically, "the budget for political subsidies and the budget for interest cartels were drastically cut, and a total of KRW 23 trillion in spending restructuring was carried out," which he described as "a drastic restructuring of nearly 20% of the government's discretionary spending of about KRW 120 trillion."

 

 

The following is the full-text of President Yoon's remarks at the cabinet meeting.

Today, we will discuss the 2024 Budget. The government has been doing its utmost to revitalize the private economy under difficult conditions. Amidst the global crisis, we prioritized stabilizing prices and livelihoods, and focused on fostering future strategic technologies and securing growth engines.

 

We have also spurred structural reforms and regulatory innovation to improve the fundamental constitution. The national debt increased by 400 trillion won due to the previous government's reckless fiscal management and exceeded 1,000 trillion won for the first time last year.

 

Our government has firmly rejected the "fiscal universalism" of the previous government and shifted to a sound fiscal stance. As a result, the soaring national debt growth has slowed dramatically.

 

Major international credit rating agencies are now rating our external creditworthiness positively.  This is due to our sound fiscal management. To safeguard our sovereign credit rating and ensure price stability, some argue that the government should loosen the purse strings ahead of the election.

 

However, expanding spending by issuing sovereign bonds will only shift the fiscal burden to future generations, while a decline in national confidence will exacerbate difficulties for entrepreneurial activity and the broader economy. 

 

Instead, our government will focus on reorienting the economy to be more market-driven and private-sector-led, encouraging more private investment and spending. We will do this by removing killer regulations that discourage private investment and overhauling the financial system.

Total spending for next year is projected at 656.9 trillion won, a 2.8% increase, the lowest since 2005. We reviewed all fiscal projects from the ground up, drastically cutting political subsidy budgets, interest cartel budgets, and restructuring spending totaling KRW 23 trillion.

 

This is a drastic restructuring of nearly 20% of the government's discretionary expenditure of KRW 120 trillion, which excludes statutory expenditure, rigid expenditure, and mandatory expenditure from the total expenditure. The freed up financial resources have been focused on what the country must do.

 

We will focus on three key areas: realizing the welfare of the vulnerable, strengthening the essential functions of the state such as national defense and the rule of law, and securing growth engines to create quality jobs. Since taking office, I have visited those in need in our society and listened to their concerns, from the root industries of traditional manufacturing to high-tech industries such as semiconductors and secondary batteries, and reflected them in next year's budget.

 

First of all, we will further support the common people, the vulnerable, and the socially disadvantaged with the financial resources saved by eliminating the election ticket budget. We have raised the payment amount of the livelihood benefit, which guarantees people's minimum standard of living, by 213,000 won next year, surpassing the total increase of 196,000 won over the past five years of the previous government.

 

For the first time since 2015, the threshold for the subsistence benefit has been relaxed from 30% to 32% of the median income, meaning 39,000 additional households will benefit. Our seniors, who laid the foundation for the freedoms and prosperity we enjoy today, must also be fully honored and respected.

 

We will expand the number of jobs for seniors to a record high of 1.03 million, 147,000 more than before, and increase their benefits by 7 percent for the first time in six years. Seniors who participate in social service-type jobs and receive the basic pension will receive 968,000 won a month, giving them more security in their later years.

 

More than 2,300 people with developmental disabilities will be provided with 1:1 care services. In particular, we will expand 24-hour individualized care nationwide to ease the difficulties of families when they are unable to take care of their loved ones.

 

We will also ease the criteria for single-parent child support, providing additional child support to 32,000 single-parent families. We will shift our support for multicultural families from "initial settlement support" to "education, employment, and other social disparities.”

 

We will provide 60,000 children from multicultural families with new educational activity grants, and create a new employment support service for married immigrants. We will increase the allowance for young people preparing for independence from 400,000 won to 500,000 won, and support 2,750 young people who are closely managed before and after their period of protection ends. We will strengthen the experiential support that young people want.

 

Equal access to higher education has been fully reflected in the budget. To ensure that all young people from low-income households can study with peace of mind on the same starting line as other students, the government will fully fund university tuition. This is an expansion of the full university tuition support from the second child of low-income households to all children. 

 

We will introduce the K-Pass, a preferential transportation card for young people, to reduce the burden of commuting transportation costs by up to 50% or more. We will reduce the cost of preparing for employment by reducing the national technical qualification examination fee for young people by 50%, three times a year.

 

We will create industrial complexes where young people can work and want to work. We will build 100 complex cultural centers and 60 beautiful streets in industrial complexes, and greatly expand youth housing and amenities such as dormitory-style offices.

 

We will provide 120,000 small businesses with low-interest loans, high-efficiency air conditioners, and up to 80% of their employment insurance premiums, saving them up to 5 million won a year.

 

Next, we will faithfully use taxpayer money to perform essential national functions such as public security, national defense, and administrative services. To fundamentally respond to the recent "don't ask" crimes, we will thoroughly restructure the police organization and adjust its budget allocation to focus on public security. 

 

We will distribute low-risk handguns to all police officers in the field, issue new weapons response equipment to 101 riot squads, and introduce simulation training systems such as situational response subduing drills and VR equipment to strengthen police capabilities to protect the safety of citizens in tense situations. 

 

We will invest an additional KRW 73.2 billion for the mental health of citizens. We will make it easier and more convenient for those in urgent need of mental health care to receive mental health counseling. This will lead to early detection of severely mentally ill people for intensive treatment and case management. We will expand the number of mental emergency medical centers and increase the number of mental health welfare centers. 

 

We will invest KRW 6.3 trillion to completely reorganize the national flood response system. The previous government focused on dismantling beams and neglected dredging and maintenance of rivers, which further exacerbated flood damage. For the sake of public safety and dimension, we will once again promote river dredging and maintenance in earnest. We will greatly expand the dredging of reservoirs from 7 to 77 to strengthen precipitation storage capacity and reduce the risk of flooding.

 

We're expanding flood early warning system for rivers across the country, moving the forecast from three hours before a flood to six hours before it happens. 

The welfare of military personnel who serve the country and its people is directly linked to national security. We will improve all 42,000 old quarters for entry-level officers to expedite the "zero rust effect." We will double the service allowance for officers and NCOs from 6 million won and 5 million won in 2022 to 12 million won and 10 million won, respectively, next year, to secure human resources for a strong military.

 

As promised to the people, we will pay an additional 350,000 won in military salaries for soldiers next year, so that we can move forward with our national task of achieving a 'military salary of 2 million won' by 2025. We will also distribute 15,000 ice water dispensers and fleece sweaters to all soldiers to make the heat and cold a little less intense. 

The quality of a nation depends on how it remembers its people. Properly honoring the heroes who have served our country is at the core of our national identity. We will raise the veterans' compensation by 5% for the second consecutive years, and open a digital veterans' exhibition center so that we can remember the dedication of our veterans in our daily lives.

 

As a global pivotal nation, we must also expand our responsible role and contribution to the international community. In line with the status of our economy, we have budgeted ODA to reach 6.5 trillion won, 2 trillion won more than this year. The increased ODA budget will be focused on strategic areas that will help advance our national interests, such as helping our businesses and youth go abroad.

 

We will more than quintuple the ODA budget for Ukraine's reconstruction and significantly increase ODA in the digital sector. We will also increase ODA investments in strategic regions such as the Indian-Pacific regions and Africa, which are key to spreading global solidarity, from KRW 1.4 trillion to KRW 2 trillion. In response to the discharge of contaminated water at the Fukushima nuclear power plant, we will establish a more thorough safety monitoring system for our waters and seafood, and significantly increase the related budget to a total of KRW 740 billion so that people can enjoy domestic seafood with peace of mind.

 

Next, we will not neglect the creation of quality jobs and securing growth engines. We will promote strategic projects worth 2.5 trillion won to preempt future industrial ecosystems such as bio and space.

 

We will invest KRW 1.8 trillion in global R&D cooperation to secure world-class technologies, such as the Boston-Korea Project.

 

For the seven specialty complexes designated this year for semiconductors, secondary batteries, and displays, we will comprehensively support infrastructure such as water, low-interest loans for technological innovation, and universities specializing in high-tech industries. 

 

Exports are the foundation of our economy and a source of job creation. Next year, the government will continue to pursue the 'Export Drive Strategy' with greater vigor. We will provide more export financing to support orders in the nuclear power plant, defense, and plant sectors.

 

We will establish a KRW 2 trillion Startup Korea Fund and create a "Korean Station F," a free startup space for young entrepreneurs. We will double investment subsidies for foreign companies, U-turning companies, and local relocation companies, focusing on high-tech sectors.

 

We will invest KRW 4.4 trillion in four areas: AI, bio, cybersecurity, and building a digital platform government. We will increase the public stockpile of key minerals such as lithium and rare earths by 40% to an average of 60 days in preparation for supply chain instability. We will more than double policy financing for K-content exports to KRW 1.8 trillion.

 

We will increase the quota for foreign skilled laborers from 5,000 to 35,000, and provide intensive training to 4,000 low-skilled foreign workers for early job settlement.

 

We will dramatically reduce the burden of childbirth and child rearing, so that the nation can take responsibility for our children and raise them together. Starting next year, high-risk mothers and premature babies will receive medical expenses regardless of income.

 

We will pay for 82,000 couples who want to have children to have fertility tests. We will prioritize 60,000 public and rental housing units for families with children. We will increase the parental allowance from 700,000 won to 1 million won for the first child, and increase the size of the voucher for the birth of a newborn from 2 million won to 3 million won for the second child.

 

To ensure that all children in basic needs households are prepared for independence from birth, we will expand the age of enrollment in the asset-building program from 12 years and above to 0 years and above. This will more than triple the amount of independence reserve they can receive as adults.

 

From mild to severe, from outbreak to treatment, the nation will step up to protect sick children. We will dramatically increase the government's budget for pediatric medical support by more than five times, from 6.2 billion won to 33.4 billion won. For the first time, we will provide 100 million won for 45 moonlight children's hospitals, where children can receive medical care at night or on holidays. We will set up a new pediatric consultation call center so that children who suddenly fall ill at night can receive 24-hour medical consultation. We will extend the parental leave benefit period from 12 months to 18 months to promote work-life balance.

 

To encourage parental leave, we will increase the parental leave benefit to a maximum of 4.5 million won for infants under 18 months of age if both parents take parental leave. We will do our best to safeguard our finances and take care of people's livelihoods through our carefully prepared budget for next year.

The regular session of the National Assembly will begin on Sept. 1. More than 200 bills have been submitted to take care of the economy and people's livelihoods and prepare food for the future. The National Finance Act, which introduces fiscal discipline for sound fiscal management; the Recruitment Procedure Act, which prevents unfair practices in recruitment; the Teacher Status Act, which restores teaching rights and normalizes public education; the Trade Union Act, which strengthens transparency in the union system; and the Korea Aerospace Administration Act, which fosters the aerospace industry, are among the many national issues that need to be reformed, starting with legislation. 

 

Delays in passing key legislation will result in the expiration of the 21st National Assembly's term. If a lot of time is spent on reintroduction, the damage will eventually be passed on to the people. I hope that the members of the National Assembly will work with urgency to ensure that major bills dealing with our livelihood and future food will be centered in this regular session.

 

Thank you.