2020 Supplementary Budget Proposal
Supplementary Budget Drawn Up, COVID-19 Turning Endemic
The government has drawn up an 11.7 trillion won worth of supplementary budget to respond to the COVID outbreak, 8.5 trillion won to add new spending and 3.2 trillion won to make a revenue adjustment. Of the 11.7 trillion won of extra spending, 1.4 trillion won will be financed with surplus funds[1] and 10.3 trillion won will be financed through debt issuance. The extra budget will be spent on disease control efforts, as well as to help businesses and local economies affected.
1. 2020 Supplementary Budget
(trillion won, %)
|
|
2019 Original Budget
|
2020 Budget
|
Change (B-A)
|
|
Original (A)¹
|
Supplementary (B)²
|
|
Total Revenues
(y-o-y, %)
|
476.1
(6.5)
|
481.8
(1.2)
|
479.2
(0.7)
|
-2.5
|
|
Total Expenditures
(y-o-y, %)
|
469.6
(9.5)
|
512.3
(9.1)
|
520.8
(10.9)
|
8.5
|
|
Consolidated Fiscal Balance
(% to GDP)
|
6.5
(0.3)
|
-30.5
(-1.5)
|
-41.5
(-2.1)
|
-11.0
(-0.6%p)
|
|
Consolidated Fiscal Balance without Funds
(% to GDP)
|
-37.6
(-1.9)
|
-71.5
(-3.5)
|
-82.0
(-4.1)
|
-10.5
(-0.6%p)
|
|
Government Debt
(% to GDP)
|
740.8
(37.1)
|
805.2
(39.8)
|
815.5
(41.2)
|
10.3
(1.4%p)
|
- Drawn up according to nominal growth outlook of 3.8 percent
- Drawn up according to nominal growth outlook of 3.4 percent
2. 2020 Supplementary Budget Proposal
(trillion won)
|
Step up disease control efforts
|
2.3
|
|
|
- Disease prevention and treatment
- Support those hit by the outbreak
|
(0.1)
(2.2)
|
- Provide support for negative pressure rooms and ambulances
- Strengthen disease prevention, including diagnostic capabilities
- Support local COVID-19 care capabilities
- Support research on the disease
- Compensate healthcare institutions for their losses and sufferings, as well as make business loans available for them
- Provide those quarantined with living expenses support, and employers with wage support for paid leave
|
|
Support small merchants and SMEs
|
2.4
|
|
|
- Make low interest rate loans available for small merchants and SMEs affected
- Promote employment retention and a rent cut in commercial properties
- Support small merchants hit by the outbreak
|
(1.7)
(0.6)
(0.1)
|
- Expand the emergency loans for business operation, and provide facilities investment support for SMEs in the disease-hit areas of Daegu City and North Kyeongsang Province
- Provide loan guarantees through the Korea Credit Guarantee Fund and Korea Technology Finance Corporation
- Invest in accounts receivable insurance funds
- Invest in export financing
- Provide wage support for small merchants
- Promote a rent cut in traditional markets by offering 100 percent support for fire prevention in the entire market in the case of at least 20 percent of shops getting rent cuts
- Support the resuming of business after shut-down due to a visit by the virus-infected
- Promote expanding to online markets
- Provide retailers in traditional markets with vouchers designed to support their marketing activities, such as joint promotion
|
|
Support consumption and employment
|
3.0
|
|
|
- Issue vouchers to low income households to support consumption
- Increase job seekers’ allowance
|
(2.4)
(0.6)
|
- Issue vouchers for local products
- Give a 20 percent raise in wages to seniors in government’s elderly job programs if they agree to receive 30 percent of their pay in local gift certificates
- Redeem 10 percent of the prices paid for home appliances with a high-energy efficiency rating
- Increase the budget for homecare allowance in the case of childcare shifting from daycare institutions to homecare
- Increase job seekers’ allowance for young adults, and reintroduce job seekers’ allowance for those from low income households
- Expand the employment support designed to promote employment retention and job training
|
|
Support local economies hit by the outbreak
|
0.8
|
|
|
- Support employment retention in hard-hit areas
- Increase local gift certificates
- Increase grants and subsidies for local governments
|
(0.1)
(0.2)
(0.5)
|
- Provide the hard-hit areas, including Daegu City and North Kyeongsang Province, with special employment retention support
- Help SMEs in Daegu City and North Kyeongsang Province recover from the hit
- Increase gift certificates for local products
- Increase education grants and subsidies for local governments to help them protect K-12 from infection
|
|
Total
|
8.5
|
|
3. Special support for Daegu City and North Kyeongsang Province, the areas hit hardest
1) 6 billion won for disease prevention and treatment
- Build an endemic care facility in the southeast region of the country, where the hardest-hit localities are placed
- Strengthen disease prevention, such as by increasing negative pressure rooms
2) 1.4 trillion won to support small merchants and SMEs
- Increase emergency business loans and guarantees
- Expand accounts receivable insurance
3) 101.0 billion won to support local economies
- Provide businesses with employment support
- Help shops affected resume their business
- Help traditional markets with running their business by issuing vouchers for the purpose
- Encourage small businesses to expand to online sales
The 2020 supplementary budget proposal will be submitted to the National Assembly after proceeding through the cabinet meeting on March 4.
Please refer to the attached pdf
