Allocations for wildfire recovery, ministry relocation, and education policies drain emergency reserves ahead of year-end

The government has confirmed that the 'reserve fund' used for unexpected situations such as disasters and emergencies has effectively been depleted. After allocating the reserve fund for the recovery of the National Information Resources Service fire and the relocation of the Ministry of Oceans and Fisheries to Busan, there is no financial capacity left to respond to unforeseen accidents for the remaining two months until the end of the year.

According to the Ministry of Economy and Finance on the 24th, most of the reserve fund allocated by the government this year has already been earmarked for specific purposes. This year's reserve fund was initially set at 2.4 trillion Korean won in the main budget. Due to conditions attached by the Democratic Party of Korea during last year's National Assembly budget review, approximately 1.2 trillion Korean won was prioritized for free high school education and free education for 5-year-olds.

In March of this year, the largest wildfire in history occurred in the Gyeongbuk region. The wildfire, which lasted for ten days, caused 1.0818 trillion Korean won in damage, with recovery costs estimated at a record 1.8809 trillion Korean won.

Additionally, the impeachment of former President Yoon Suk-yeol led to the early 21st presidential election on June 3, requiring further use of the reserve fund. The budget approved last year did not account for election-related expenses.

The government held a Cabinet meeting on April 8 and allocated 395.7 billion Korean won from the reserve fund for election-related expenses, including polling station operations, vote counting management, election subsidies, and election cost reimbursements.

As the reserve fund for wildfire damage support became insufficient, the government secured 3.2 trillion Korean won in new disaster and emergency response funds through the first supplementary budget in May. At the time, the government explained that a significant portion of the reserve fund had been secured by including additional reserve funds (1.4 trillion Korean won) and direct damage recovery support budgets (1.4 trillion Korean won) in the supplementary budget. A government official stated, "As of July, the 1.4 trillion Korean won secured through the first supplementary budget remained almost intact."

However, reserve fund expenditures began to increase again in August. To advance the relocation of the Ministry of Oceans and Fisheries to Busan, a campaign pledge by President Lee Jae-myung, the government decided to invest 86.7 billion Korean won from the reserve fund during a Cabinet meeting on August 18.

On September 16, 307.977 billion Korean won for child allowances and parental benefits, which became insufficient due to increased births, 42.22 billion Korean won for the 'First Encounter Voucher' (a voucher worth over 2 million Korean won provided to newborns), and 1.995 billion Korean won for the operational costs of launching the High-Level Radioactive Waste Management Committee were covered by the reserve fund.

This month, reserve fund expenditures continued. The government allocated 5.12 billion Korean won from the reserve fund on the 14th for overseas promotion to attract top talent to South Korea. This decision was made in response to the U.S. Trump administration's visa fee increase, aiming to use the reserve fund for promotional activities to attract overseas research talent.

On the 21st, 152.1 billion Korean won was allocated from the reserve fund to repair administrative systems disabled by the National Information Resources Service fire. Additionally, a significant portion of the reserve fund was reportedly exhausted by the National Intelligence Service. The NIS's reserve fund execution details are classified as 'Level 2 confidential' for national security reasons and are not disclosed.

A government official said, "Given the demands that have already arisen, this year's reserve fund is expected to be fully depleted." This raises concerns about insufficient financial resources to respond to unexpected disasters or emergencies until the end of the year. However, the official added, "Looking at past disasters such as heavy rains and wildfires, accidents rarely occur after September or October."

Government Reserve Fund Depleted, Leaves No Funds for Emergencies