[THE INVESTOR] Under the new Moon Jae-in administration, the Finance Ministry has set up renewed guidelines for next year’s budget prioritizing Moon’s key policies, such as job creation and income growth, the ministry said on May 19.
The Ministry of Strategy and Finance said it has revised its budget guidelines for 2018, which had been announced on March 31, to reflect the new government’s key policy tasks.
“To reflect the new government’s policies and streamline fiscal spending, we have sent out additional budget guidelines to each ministry and agency as of May 15 ,” the ministry said in a statement.
The key policy areas in need of budget fine-tuning are job creation, income growth-led economic growth, tackling the low birthrate and reducing fine dust, it said.
“To prioritize large projects that generate many jobs, we will have ministries show how each budget will create how many jobs,” the ministry said.
They government will promote jobs in the public sector, startups and venture firms to employed youths, as well as seniors who have recently begun seeking employment.
To support income growth-led economic growth, the government will support more for low-income households, it said.
To reduce fine dust, the government plans to install more fine dust measuring devices at public places and expand renewable energy.
To secure more fiscal income, the ministry said it will reduce tax incentives on conglomerates and high income earners, as well as collect more taxes from tax evaders. It will also strictly impose fines for unfair trade acts and promote dividends from government-invested institutions.
The Finance Ministry also demanded other ministries and agencies to review all their budget spending plans from scratch and cut 10 percent of the budget by streamlining spending structure.
During the election campaign, Moon had vowed to secure an annual fiscal income of 22.4 trillion won (US$19.8 billion), or 112 trillion won in his five-year term, through cutting expenses at state-run firms and rooting out dubious budgets or pork barrel spending.
The government earmarked 420 trillion won for the next year’s budget, up from 400 trillion won in 2017.
The previous budget guidelines included more focus on the fourth industrial revolution but the issue was taken out in the updated one. Instead, the fine dust issue was inserted.
Each ministry and related agency should submit their budget spending plan to the Finance Ministry by the end of May, which was extended from May 26 due to the updated guidelines.
After reviewing all the plans, the Finance Ministry is scheduled to submit its 2018 budget proposal to the National Assembly on Sept. 1.
By Kim Yoon-mi/The Korea Herald (firstname.lastname@example.org)