President Lee Jae-myung said in a National Assembly policy speech on the 4th explaining next year's budget bill and seeking cooperation, "Just as President Park Chung-hee laid the highway for industrialization and President Kim Dae-jung opened the highway for informatization, we must now build the highway for the AI era to open a future of leap and growth." He then named the 728 trillion won government budget bill "Korea's first budget to open the AI era." It was Lee's second policy speech to the National Assembly; on Jun. he visited the Assembly to deliver his inaugural greetings and to seek cooperation on the supplementary budget.
In a policy speech at the National Assembly plenary session on the morning of the day, Lee said, "In the era of industrialization, being late by a day set you back a month; in the era of informatization, being late by a day set you back a year; but in the AI era, being late by a day sets you back a generation," adding, "Regrettably, the previous administration not only wasted precious time but also regressed into the past by drastically cutting the R&D budget. Because our start was late, we must steadily pick up speed from now on."
The government's 2026 budget bill totals 728 trillion won, up 8.1% from this year, the largest ever. Lee called it "a strategic investment that considers both the AI era, future growth, and the sustainability of public finance," adding, "I ask for the National Assembly's active cooperation." At the session, Lee cited as key directions of the budget bill: ▲ expanding investment to open the "AI era" and laying the foundation for growth ▲ protecting vulnerable groups and the lives and safety of the public ▲ responding to demographic changes through life-cycle support and balanced development.
◇ 10 trillion won for "top three AI powerhouses"… "A starting point to prepare for the new century"
Next year's budget bill allocates 10.01 trillion won to advance the Lee Jae-myung government's national agenda of becoming one of the "top three AI powerhouses." That is more than triple this year's 3.3 trillion won. Of that, 2.6 trillion won will be invested to introduce AI across all industrial, daily-life, and public sectors, and 7.5 trillion won will go to talent development and infrastructure. In particular, to achieve an "AI great transition" in key industries such as robots, automobiles, shipbuilding, home appliances, semiconductors, and factories, 6 trillion won will be invested over five years.
Lee said, "With this budget, we will establish physical AI regional hubs by metropolitan area in connection with regional specialized industries and promote large-scale R&D and demonstrations to accelerate AI-based regional innovation." He continued, "We will support the rapid AI application of 300 daily-life products such as biohealth and dwellings and logistics, and expand AI adoption in the public sector focused on welfare and employment, taxation, and new drug review." He added, "Next year will open the 'AI era' and serve as a historic starting point to prepare for Korea's new century."
◇ Raise basic livelihood benefits and add labor inspectors, 5.5 trillion won for disaster response
The government raised the standard median income by 6.51% to ensure a stable income base for low-income groups next year, the largest increase ever. It also included a budget to provide more than 2 million won per month in basic livelihood benefits for a four-person household. To protect public safety, the number of labor inspectors will be increased by 2,000, and the state budget will support the expansion of safety facilities at 17,000 small workplaces and construction sites. In addition, a total of 5.5 trillion won was allocated for disaster prevention and rapid response, an increase of 1.8 trillion won from the previous year.
Immediately after taking office, Lee declared a "war on industrial accidents" and ordered a pan-government response to strengthen economic penalties over criminal punishment. Lee said, "We will expand the number of beneficiaries of daytime activity services for people with developmental disabilities and greatly increase jobs for people with disabilities to solidify the foundation for independence and social participation," adding, "To prevent industrial accidents, we will introduce workplace guardians and conduct constant on-site inspections in high-frequency sectors such as construction and shipbuilding."
◇ Expand child allowance, create a savings plan for "low-income youth savings support"
Next year's budget bill focuses on "responding to demographic changes" and allocates tailored support expenses by age group. Accordingly, the age for child allowance payments will be expanded from under 7 to under 8 in 2026, and to under 12 during the president's term. The government also created the "Youth Future Savings" program, under which it will match up to 12% when low-income youth save. In addition, a "flat-rate public transit pass" will be introduced, and 24 trillion won in local gift certificates will be issued to support small business owners.
Lee said he would swiftly introduce a "principle of fiscal preference for the regions," adding, "It is to overcome the current structure entrenched in a single-capital-area system and to open a new era of five poles and three specialized zones, with the regions as the center of growth." The budget bill sets the size of block grants to local governments at 10.6 trillion won, about triple this year's level, so that local governments can decide projects on their own according to their circumstances.
He went on, "To ease concentration in the capital area and achieve balanced national development, we will provide thicker support the farther from the capital area," adding, "As part of that, we will ensure that seven fiscal programs, including child allowance and senior jobs, receive more support in non-capital regions."
◇ After finishing "diplomatic super week," Lee says, "I poured in my soul"
Before explaining the budget bill that day, Lee highlighted the results of the Asia-Pacific Economic Cooperation (APEC) summit held in Gyeongju the previous week and of the summits with the United States and China. Lee said, "For the first time at an APEC summit, we agreed to tackle together the shared challenges facing humanity, including AI and low birthrates and aging," adding, "With the world watching, by leading to the 'Gyeongju Declaration,' Korea was able to take the lead in the Asia-Pacific region's exchange and prosperity and in promoting peace in the region."
In particular, regarding the conclusion of tariff negotiations with the United States, he assessed, "We reduced uncertainty in our economy and secured tariffs at a level equal to competitors in our key export items, automobiles and semiconductors, laying the groundwork to compete on a level playing field." On the U.S.-bound investment package, centered on "$20 billion per year, paid over more than 10 years," he said, "By setting an annual investment cap, we minimized the shock to the foreign exchange market, and by securing multilayered safeguards in the selection and operation of investment projects, we increased the likelihood of recouping the investment."
Regarding "supply of nuclear fuel for nuclear-powered submarines," which President Donald Trump publicly approved a day after the summit, Lee said, "We have further solidified the foundation for self-reliant national defense, and by creating a breakthrough opportunity for uranium enrichment and the reprocessing of spent nuclear fuel, we have been able to strengthen future energy security."
At the Korea-China summit, the government also agreed to a "70 trillion won currency swap between the two Central Banks" and to "sign six MOUs, including cooperation on combating transnational scam crimes." Lee said, "Through the summit, we fully restored Korea-China relations, and the two countries agreed to move forward again on a path of pragmatism and mutual benefit as strategic cooperative partners," adding, "Even in the worst circumstances, we did our utmost, pouring in our souls, to produce the best results."
◇ "It's war" Policy speech without the opposition… Lee says, "It feels a bit empty"
The opposition People Power Party did not attend the policy speech. It was to condemn the request for an arrest warrant for former floor leader Chu Kyung-ho and to urge the resumption of five trials involving Lee. In Sept., a warrant was requested for the former floor leader on charges of "obstruction of a vote" and "abuse of power and obstruction of another's rights," but the content released by the special counsel the previous day omitted those charges, they said. Party leader Jang Dong-hyeok said, "If the act of 'obstruction of a vote' that allegedly colluded with and aided insurrection is missing, then what exactly did they collude in and what did they aid?" adding, "It's war now."
He added, "It is time for us to rally all our strength to bring down the Lee Jae-myung administration," and, "The president is coming to the National Assembly today to deliver a policy speech. This must be the last policy speech." After a general assembly of lawmakers, they held a protest rally in front of the Rotunda Hall of the National Assembly's main building. At about 9:39 a.m., when Lee appeared, People Power Party lawmakers shouted, "Stand trial," and "Get out." Lee, however, approached the People Power Party lawmakers holding protest placards, gave a slight bow, and moved on. Standing at the podium just before the policy speech, Lee looked at the empty opposition seats and said, "It feels a bit empty."