Yoon blames previous government for increasing national debt by 400 trillion won

Aug 28, 2024, 11:12 am

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President Yoon Suk-yeol presides over a Cabinet meeting at the presidential office in Seoul on Aug. 27, 2024./ Source: Yonhap

AsiaToday reporter Lee Choong-jae

The government has decided to increase the 2025 national budget by 3.2 percent to 677.4 trillion won (US$509.17 billion), aiming to sustain its belt-tightening stance unlike former President Moon Jae-in’s government whose annual budget bill grew by 8.7 percent in average over the past five years. The Yoon Suk-yeol government aims to maintain the fiscal soundness by adhering to a belt-tightening policy while sustaining a modest growth in expenditures.

Yoon declared a complete separation from the expansionary fiscal policy of the previous Moon Jae-in government. “The previous government increased the national debt by more than 400 trillion won (US$301 billion) over its five-year term. This places a significant financial burden on the current government,” Yoon said while presiding over a Cabinet meeting on next year’s budget.

“Sound fiscal management is the fundamental principle our government has adhered to in the budgets in the last three years,” Yoon said. “We must tighten our belts, boldly reduce inefficiencies and ensure that budget is spend effectively on necessary areas.”

The government has proposed a budget worth 677.4 trillion won for next year, representing a 3.2 percent increase over this year. The gross revenue was set at 651.8 trillion won, up 6.5 percent from this year’s 612.2 trillion won. The proposal cut 24 trillion won in government spending by reevaluating the feasibility and effectiveness of all fiscal projects.

The average growth rate of total expenditure during the Yoon Suk-yeol government’s three-year term of office is 3.7 percent, which marks the lowest increase in government expenditure for any administration in their third year since 2005. The government plans to implement drastic spending restructuring and minimize low-performance and similar overlapping investments.

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