NABO Fiscal Trends & Issues (Vol. 3, Issue. 14, 2020)
Published on 28 September 2020
Published by Social Budget Analysis Division of the Budget Analysis Department
I. Key Fiscal Indicators
The progress rates for total revenues and total expenditures up to July 2020 are 59.6% and 65.1%, respectively. In addition, the consolidated central government balance (in the form of a 75.6 trillion won deficit) increased by 51.3 trillion won, YoY, up to July 2020. As of end-July, 2020, central government debts (781.0 trillion won) increased by 82.1 trillion won since the settlement of accounts of FY2019, mainly due to reasons such as an increase in the outstanding balance of sovereign bonds (by 80.4 trillion won).
Ⅱ. Major Fiscal Issues
The major fiscal issues in the third quarter of 2020 were introduced, along with the challenges ahead and implications of these issues. The issues covered are “the submission of the 2021 budget plan to the National Assembly,” “the submission of the 2020-2060 Long-Term Fiscal Outlook to the National Assembly,” “outcomes of the 4th National Assembly’s examination of the supplementary budget of the year 2020,” “the announcement of the comprehensive plan for the Korean-version of the New Deal,” “The Korean New Deal: Digital New Deal and budget plans for 2021,” “The Korean New Deal: Green New Deal and budget plans for 2021,” “The Korean New Deal: strengthening safety nets and budget plans for 2021,” “progress and support status of the clinical trials and support related to COVID-19 treatment and vaccines in Korea,” as well as “the management performance evaluation results for public institutions in 2019.”
Ⅲ. Committee-specific Fiscal Status in Preparation for the 2021 Budget Plan Examination
In this section, a brief introduction is made regarding the fiscal status of the 2021 budget plans of each standing committee at the National Assembly. Details include the launching of a policy-type New Deal Fund (National Policy Committee); the new introduction of a “green, smart school” project (Education Committee); increased investments in innovation competency such as the Digital New Deal, Korea’s “three promising industries” as well as basic and nuclear plant R&D (Science, ICT, Broadcasting and Communications Committee); increased support budgets following the increased issuance of local currency gift certificates (GLC) and higher discount rates (Public Administration and Security Committee); as well as the full-fledged implementation of the Green New Deal as an effort to accelerate the transition to a greener environment (Environment and Labor Committee).
Ⅳ. Overseas Fiscal Trends
Key fiscal-related issues in major economies are introduced via “ODA achievements in 2019 by members of the OECD DAC and how major countries have been supporting the response to COVID-19 in 2020” as well as “a comparison of R&D investment trends between major OECD member nations.”