Prime Minister Chung Sye-kyun delivers a speech after the National Assembly approved the 2021 budget bill at a plennery session on Dec. 12. (Photo: National Assembly)

The National Assembly approved next year’s budget of 558 trillion won, a 2.2 trillion won increase from the planned budget set by the government on Dec. 2.

It marked the first time in six years that the ruling and opposition parties have met the legal deadline for a budget bill.

Ruling and opposition parties voted on the revised budget bill for 2021.

They initially planned to complete the budget statement in the morning and hold a plenary session at 2 p.m. after a meeting of the Special Committee on Budget and Accounting to deal with the bill that day.

However, a plenary session was held late in the evening due to a delay in working-level talks after a disagreement broke out over the budget for a new airport on Gadeok Island.

The parties allocated three trillion won for the payment of support funds to those hit hard by the spread of the COVID-19 virus and 900 billion won for the procurement of COVID-19 vaccines in the budget.

In addition, they jacked up the total budget by 8.1 trillion won by including funds for vulnerable groups, such as funds for ordinary people’s housing welfare, child and elderly care services and the livelihood of veterans’ families and the disabled.

By sector, the National Assembly significantly slashed the general and local administrative budget by 1,846.1 billion won from the amount in the government's budget bill.

The budget for industrial, small and medium-sized enterprises and energy was also cut by 494.8 billion won and the health, welfare and employment budget by 153.2 billion won.

On the other hand, lawmakers ramped up spending for public order and safety by 540.8 billion won. On top of that, they gave 52.3 billion won more to the social overhead capital (SOC) sector, 280.3 billion won more to the agricultural, fishery and food sector, 21.6 billion won more to the research and development (R&D) sector and 181.6 billion won more to the education sector.

With respect to revised bills of the Commercial Act, the Fair Trade Act and the Labor Union Act passed at the regular session of the National Assembly on Dec. 9, business organizations jointly put out a statement saying, “We request supplementary legislation because the three revised bills can negatively impact the national economy.”

Four major business organizations - the Korea Employers Federation, the Korean Federation of Small and Medium Business (KBIZ) and the Federation of Middle Market Enterprises of Korea and the Korea Listed Companies Association - jointly issued statements on Dec. 14.

 
In the statement, they requested supplementary legislation on the revision of the Commercial Act focusing on the separate appointment of auditor and directors and the so-called three-percent rule.

“Now that the Commercial Act will be implemented immediately at the same time as its promulgation, companies that need to appoint new auditors at their general shareholders' meetings between February and March 2021 will become vulnerable to threats from foreign funds,” they asserted.

In the meantime, the government announced the first basic plan for relaxing or improving regulations on new industries in a meeting on checking current national issues presided over by Prime Minister Chung Sye-kyun on December 11.

The plan, which includes details of how to implement the plan from 2021 to 2023, focuses on practical regulatory improvements centered on key new industries.

The government will eradicate various regulations that do not conform to global standards, although a regulatory sandbox produced some meaningful results, Prime Minister Chung said.

The government will expand the regulatory sandbox sector. It has decided to expand target areas from five to seven by adding mobility and R&D and extend the special exemption period from current four years.

A plan to normalize the support organization will also be implemented. The government will make an improvement to 20 core new industry regulations in five major areas.

The five major areas include the DNA industry, non-face-to-face industries, the “smartization” of basic industries and the promotion of green industries.