It has been confirmed that the "reserve funds" used when sudden situations such as disasters and calamities occur have effectively run dry. After using reserve funds for the National Information Resources Service fire recovery and the transfer of the Ministry of Oceans and Fisheries to Busan, there will be no fiscal capacity to respond if unexpected accidents occur for about two months until the end of the year.
According to the Ministry of Economy and Finance on the 24th, most of the reserve funds the government allocated this year already have designated uses. This year's reserve funds were set at 2.4 trillion won in the original budget. Under conditions attached by the Democratic Party of Korea during last year's National Assembly budget review, about 1.2 trillion won was first injected into free high school education and free education for 5-year-olds.
Then, on Mar. 22 this year, the North Gyeongsang region saw the largest wildfire on record. The wildfire, which continued for ten days, caused 1.0818 trillion won in damage, and the restoration cost was estimated at a record 1.8809 trillion won.
In addition, with the impeachment of former President Yoon Suk-yeol leading to an early 21st presidential election on Jun. 3, additional reserve funds had to be used. The budget finalized last year did not reflect election-related expenses.
On Apr. 8, the government held a Cabinet meeting and executed 395.7 billion won in election-related budget items—polling place operations, ballot counting management, election subsidies, and reimbursement of election expenses—from the reserve funds.
As reserve funds for wildfire damage support became insufficient, the government newly secured 3.2 trillion won for disaster and calamity response through the first supplementary budget on May 1. In addition to the extra reserve funds (1.4 trillion won), the government included direct damage restoration support budget (1.4 trillion won) in the supplementary plan, explaining at the time that it had procured a sizable amount of reserve funds. A government official said, "As of July, the 1.4 trillion won secured through the first supplementary budget remained almost intact."
However, spending of reserve funds began to rise again starting in August. To push forward with the "transfer of the Ministry of Oceans and Fisheries to Busan," a presidential campaign pledge by President Lee Jae-myung, the government decided at a Cabinet meeting on Aug. 18 to inject 86.7 billion won in reserve funds.
On Sep. 16, the government covered 307.977 billion won in child allowance and parental benefit budget shortfalls due to an increase in births, 42.22 billion won for the First Meeting Voucher (a voucher that pays at least 2 million won to newborns), and 1.995 billion won in operating expenses for launching the High-level Radioactive Waste Management Committee from the reserve funds.
Reserve fund expenditure continued this month. On the 14th, the government allocated 5.12 billion won in reserve funds for publicity to attract outstanding overseas talent to Korea. Triggered by the Trump administration's increase in U.S. visa fees, the government decided to spend reserve funds on promotional work needed to bring outstanding overseas research personnel into the country.
On the 21st, 152.1 billion won was allocated from the reserve funds for restoring administrative systems disabled by the National Information Resources Service fire. In addition, it was reported that a considerable amount of reserve funds was injected into the National Intelligence Service and exhausted. The NIS's reserve fund execution details are classified as "Level 2 confidential" for national security and are not disclosed.
A government official said, "At the current level of demand, this year's reserve funds are expected to be fully exhausted." This raises concern that resources to respond will be insufficient if unexpected disasters or calamities occur by year's end. However, the government official said, "Looking at past disasters such as heavy rains or wildfires, accidents tend not to occur much after September to October."