Next year's budget for the health and welfare sector has been reduced by 165.5 billion won from the government proposal, raising red flags for major policy initiatives.
The Ministry of Health and Welfare announced on the 10th that the total expenditure for the Ministry of Health and Welfare's budget and fund operation plan for 2025 has been finalized at 125.49 trillion won. This is an increase of 8.4465 trillion won (7.2%) compared to this year's budget.
However, during the National Assembly's budget review process, the budget was cut by a total of 165.5 billion won compared to the initial government proposal. In particular, the ‘support for national mental health investment’ budget was reduced by 7.475 billion won from the government's proposal. This project provides professional psychological counseling services for citizens experiencing emotional difficulties such as depression and anxiety. Previously, the opposition party labeled this project as the ‘Kim Gun-hee budget’ and warned of cuts. The government had planned to invest 50.83 billion won, an increase of 3.581 billion won compared to this year.
The Korean-style Advanced Research Projects Agency for Health (ARPA-H) project budget was also cut by 6.9 billion won. The Korean-style ARPA-H project aims to conduct mission-driven research and development (R&D) with high costs and significant impact to solve national health care challenges.
The budget for improving the training environment for residents, which the government sought to expand as part of its healthcare reform agenda, has also been reduced by about 23%. The government had planned to allocate 392.242 billion won for the ‘training and proper supply management of medical personnel’ project. However, the approved budget was cut by 93.112 billion won to 299.13 billion won.
The Ministry of Health and Welfare stated, “We plan to thoroughly prepare budget allocation and execution plans so that the budget approved by the National Assembly can be executed quickly and without disruption immediately after the start of the 2025 fiscal year.”
However, earlier on the 2nd, Minister Jeong Kyu-hong noted, “If the final budget is confirmed with only cuts reflected without discussions on increases, the welfare ministry's budget will be reduced by 165.5 billion won compared to the government proposal, and difficulties for vulnerable groups are expected to worsen, with the budget for maintaining the emergency medical system and strengthening the emergency medical system to address emergency room overcrowding not reflected, raising concerns that public inconveniences and difficulties due to medical vacancies could further increase.”
The budget proposal passed on this day is a unilateral reduction carried out by the opposition parties, including the Democratic Party of Korea, without the consent of the government and ruling party. As the authority for budget increases lies with the government, the opposition party only made cuts to draft next year's budget. The People Power Party attempted to negotiate with the opposition by presenting a budget increase proposal just before the budget proposal was submitted, but negotiations ultimately collapsed. This is the first time in constitutional history that the budget proposed by the government was processed in the plenary session after amendments solely by the opposition.