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The government will increase spending on research and development and social infrastructure in 2009. But the increase rate of the budget for the welfare sector, which had consistently grown over the past decade, will fall slightly. Salaries and bonuses for government employees will be frozen.
In a Cabinet meeting on Tuesday, the government decided on a budget of W273.8 trillion (US$1=W1,207) for next year, up 6.5 percent or W16.6 trillion from this year, to be submitted to the National Assembly in early October.
Next year's R&D budget will be W12.3 trillion, up 10.8 percent from this year and the highest increase rate of all sectors. The increase rate of next year's infrastructure budget (W21.1 trillion) is 7.9 percent, far higher than the annual average rate of 2.5 percent during the Roh Moo-hyun administration.
The budget for welfare will increase from this year's W67.7 trillion to W73.7 trillion, reducing the increase rate from this year's 10 percent to 9 percent. The increase rate of the education budget, earmarked at W38.7 trillion, will shrink from 13.6 percent to 8.8 percent.
Strategy and Finance Minister Kang Man-soo said in allocating the budget for next year, the government ˇ°gave priority to enhancing the economic vitality and growth potential by creating jobs."
In a financial plan for the 2008-2012 period released Tuesday, the government said it will manage the economy on the assumption of growth at 6.2 percent, significantly less than the 7.2 to 9.2 percent projected earlier, to seek a balanced budget by 2012. Critics are already saying balancing the budget will not be easy given the worldwide economic slowdown and the government's plan to offer drastic tax cuts.
(englishnews@chosun.com )
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