|
The government plans to spend W257.3 trillion (US$1=W923) next year, up 7.9 percent from W238.4 trillion this year. To finance the expanded budget, the public will have to pay W210.83 trillion in taxes, an increase of W10.38 trillion from this year. The per-capita tax burden will jump W200,000 to W4.34 million.
The Ministry of Planning and Budget on Thursday announced the 2008 budget plan, which will be submitted to the National Assembly on Oct. 1 after it is approved at a cabinet meeting.
 |
|
Minister of Planning and Budget Chang Byoung-wan explains the 2008 national budget at the ministry building in Seocho-gu, Seoul, on Thursday./Yonhap
|
 |
|
The expansion in the consolidated budget, which includes ordinary and special accounts as well as state funds, is the largest since 2005 when statistics were first drawn up based on total government spending.
The increase in the proposed budget is larger than the projected economic growth of 7.3 percent, which puts together real economic growth and inflation, and therefore will likely spark controversy over an expansionary budget.
The government will issue state bonds worth W8.5 trillion to cover the expansion, as revenues from taxes will not be enough. Therefore, the national debt will grow more than W12 trillion, from W300.7 trillion this year to W313.3 trillion next year. The national debt has surged by W167 trillion over the past five years since the current government took office. That's more than the total of debt growth of W134 trillion under all the previous administrations since the first modern Korean government was established in 1948.
Next year's budget focuses on social welfare and provincial development. Spending on social welfare and health will increase 10 percent from this year to W67.5 trillion. Funding to help the provinces will soar 22.6 percent to W12 trillion.
Budget appropriations for economic growth have jumped, as more than W10 trillion will go to research and development for the first time. But with the emphasis on welfare, only W12.6 trillion will be allotted to support industries and small- and medium-sized businesses, up just 0.1 percent.
Spending for transportation, logistics, local development, and the agricultural and fisheries sectors will rise only 2.4 percent and 3.4 percent.
Minister of Planning and Budget Chang Byoung-wan said that the budget proposal is centered on expanding social investment and securing a driving force for future growth in preparation for a low birth rate and an aging society.
The government will raise wages for public officials by 2.5 percent next year. Therefore, labor costs for public servants will jump 7 percent from this year to W23.4 trillion next year if the proposal passes parliament.
(englishnews@chosun.com )
|
