2019 budget gives big boost to SOC spendingThe National Assembly passed a budget bill for next year on Saturday that cuts back on employment and spends more on social overhead capital (SOC) and inter-Korean projects.
The parliament approved a 469.6 trillion won ($417.4 billion) budget bill on Saturday in a 168-29 vote with 15 abstentions. The bill was 900 billion won less than the government’s initial proposal, but 40.7 trillion won, or 9.5 percent, more than this year’s budget.
The allocation for SOC was 19.8 trillion won, which was 4 percent more than this year. The parliament increased the SOC budget by 1.2 trillion won from the proposal made by the government. SOC projects include building and extending railroads, and expanding subway lines and highways.
SOC spending has a direct influence on people’s lives, which is why lawmakers were keen to raise the amount. The Moon Jae-in administration actually opposes such an increase. The budget for SOC projects has decreased over the past three years.
The budget for inter-Korean projects increased by some 6 billion won, or 0.5 percent, to 1.1 trillion won. The money will be used for three reunions of families separated during the Korean War, and to create tourist attractions in the demilitarized zone.
The budget for social welfare and employment was reduced from the government’s 162.2 trillion won proposal to 161 trillion won. The opposition has been skeptical about the government’s bold employment projects.
The welfare and employment budget accounts for the largest portion. Its 161 trillion won is 11.3 percent more than this year’s budget.
The parliament also passed a higher budget to foster industry infrastructure considered necessary to lead growth in the future. It allocated 20.5 trillion won in R&D, which is 4.4 percent more than this year. In industry and energy, it allotted 18.8 trillion won, which is 15.5 percent more.
The budget will be used to establish two smart industrial complexes, according to the Finance Ministry. It will expand the number of smart factories from the current 2,100 to 2,800 next year.
Some of the budget will be used to build infrastructure for 5G network and fuel-cell electric vehicles. The parliament created a 400 million won budget to create a test bed for 5G. Spending on building charging infrastructure for electric vehicles was increased by 144 billion won in the revised bill.
Additional funds have been allocated to troubled industries like auto and shipbuilding.
The bill included a 74 billion won additional budget to support the auto and shipbuilding industries through the Korea Credit Guarantee Fund and Technology Credit Guarantee Fund. It added 4.8 billion won to the budget to help SMEs in select regions to invest more in R&D.
Budget for education decreased by 300 billion won from the government’s proposal to reach 70.6 trillion won. The budget for the military remained the same as this year at 46.7 trillion won.
This year’s budget approval came six days after the legal deadline of Dec. 2.
BY JIN EUN-SOO [email@example.com]