Yoon vows fiscal prudence in 2025 budget proposal

Kim Eun-jung, ???

Kim Eun-jung

All News 10:53 August 27, 2024

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By Kim Eun-jung

SEOUL, Aug. 27 (Yonhap) — President Yoon Suk Yeol pledged on Tuesday to uphold fiscal soundness in the 2025 budget proposal while prioritizing the welfare of vulnerable groups and fostering economic growth.

Yoon presided over a Cabinet meeting to approve the government’s budget proposal of 677.4 trillion won (US$509.71 billion) for 2025, a 3.2 percent hike from this year.

“The proposal cut 24 trillion won in government spending by reevaluating the feasibility and effectiveness of all fiscal projects,” Yoon said. “The savings will be allocated to essential national tasks.”

Yoon said that the national debt had surged by over 500 trillion won during the previous Moon Jae-in administration’s 2017-2022 term to 1,076 trillion won, creating significant fiscal challenges for his government.

“Given the challenges ahead, particularly with the rising
costs of health insurance and pensions due to an aging population, we must tighten our belts, boldly reduce inefficiencies and ensure that budget is spent effectively on necessary areas,” Yoon said. “Sound fiscal management is the fundamental principle our government has adhered to in the budgets in the last three years.”

The government has adopted a fiscally conservative approach in response to declining tax revenues and economic uncertainties after years of expansionary budgeting during the COVID-19 pandemic.

The Ministry of Economy and Finance plans to submit the budget proposal to the National Assembly early next month for approval.

Source: Yonhap News Agency