Park Hong-keun, nominee for Minister of Planning and Budget, emphasized on the 3rd that "the Republic of Korea currently needs an active role for fiscal policy." With a four-term senior lawmaker known for expansionary fiscal views taking charge of the nation's budget command, projections suggest spending expansion including supplementary budget formulation will accelerate.
Park made the remarks while arriving at his confirmation hearing preparation office at the Korea Deposit Insurance Corporation in Seoul. "The Republic of Korea is currently advancing toward a super-innovative economy together with President Lee Jae-myung and all citizens, even amid a structural compound crisis," he said. "At times like this, an active role for fiscal policy is necessary."
He also expressed willingness to undertake bold fiscal restructuring. "Since fiscal resources are not a bottomless well, they must be used in the right places, and non-essential budgets must be boldly cut to create maximum efficiency," Park said. "Through bold restructuring, I want to do my best to ensure fiscal policy serves as economic pump-priming that reaches every corner of local communities."
Park, who personally led the separation of the Planning Ministry at the National Policy Planning Committee last year, cited establishing a mid-to-long-term national development strategy, tentatively called "Future Vision 2050," as a key initiative after his appointment. "One of the most central functions of the Planning Ministry is the new design of national strategy," he said. "The Planning Ministry will faithfully serve as the architect of Korea's future."
However, when asked about the possibility of supplementary budget formulation, he avoided a direct answer, saying "this must be discussed through consultation with the Presidential Office and government ministries." President Lee has emphasized the need for a supplementary budget multiple times at recent Cabinet meetings.
Park, who emphasized active fiscal policy from his first day at work, is classified as a representative expansionary fiscal advocate within the ruling party. When processing a 728 trillion won budget—an 8.1% increase from the previous year—in the National Assembly late last year, he evaluated: "Although the national fiscal situation is not easy, there are more tasks to solve nationally than ever before. This can be seen as boldly formulating an expansionary fiscal policy." Regarding opposition concerns about rising national debt, he argued: "Reducing debt is not what matters—if we grow GDP through more efficient and focused investment, the debt ratio will decrease."
From June 2020 to August 2021, Park served consecutively as the ruling party's chief secretary and then chairman of the National Assembly's Special Committee on Budget and Accounts. His experience leading the passage of the 2021 main budget and four supplementary budgets has led to interpretations that President Lee's will regarding supplementary budget formulation was reflected in Park's selection.
During the second supplementary budget of 2021, Park as Budget Committee chairman advocated paying 200,000 won in COVID-19 relief funds to all citizens, but expressed regret after facing opposition from the Ministry of Economy and Finance, which proposed paying 250,000 won to 88% of citizens.
When the Yoon Suk-yeol administration launched in 2022 pursued a supplementary budget centered on expenditure restructuring, Park, then floor leader, strongly criticized that "additional government bond issuance is inevitable."
A Planning Ministry official said: "The specific roadmap will emerge after the minister's appointment, but it is true that there is already outside talk that this year's supplementary budget, as well as next year's budget proposal, will continue the expansionary fiscal stance."
Among fiscal experts, there are calls for sophisticated expansionary fiscal policy. With U.S. tariff uncertainty compounded by growing possibilities of all-out war with Iran recently, forcefully pushing through a supplementary budget worth tens of trillions of won could produce side effects such as rising government bond rates and exchange rates.
Kim Sang-bong, professor of economics at Hansung University, said: "If a supplementary budget is hastily formulated, bond and market interest rates will rise from government bond issuance, causing significant harm to borrowers." He added: "This year's budget has already increased substantially, so there is no need to even discuss a supplementary budget—there is no guarantee that growth will match the increase in fiscal input." He pointed out that escaping long-term low growth is currently the top priority, and accumulating debt through temporary fiscal expansion could only amplify side effects if next year's growth rate falls.