Gyeonggi Province Governor Choo Mi-ae, who has officially declared a fiscal emergency in the province, has launched sweeping budget cuts totaling 550 billion won ($390 million) to protect essential public welfare programs covering vulnerable residents, child care, low birth rate responses, public safety and medical services.
Jeong Du-seok, head of the province's planning and coordination office, held a press conference at the Gyeonggi Provincial Government building Wednesday and announced the submission to the Gyeonggi Provincial Assembly of a second supplementary budget for 2026 totaling 42.24 trillion won.
Gyeonggi Province said it focused on crafting what it called a "people's livelihood supplementary budget" — not simply a spending reduction, but an effort to secure essential welfare funding that had not been included in the fourth quarter — in line with Governor Choo's directive that "even in a serious fiscal crisis, people's livelihoods and safety must be protected."
The supplementary budget was drawn up to address a deteriorating fiscal environment marked by an expected 300 billion won shortfall in local tax revenue — including acquisition taxes, a key source of provincial income — due to a slowdown in real estate transactions. Mounting accumulated debt and the near-total depletion of available reserve funds have left the province with little financial room to maneuver.
The province carried out a sweeping expenditure restructuring — adjusting event-based and one-off programs, eliminating overlapping projects, and conducting a full review of project scale and timing — resulting in cuts of 546.5 billion won from existing budgets.
Major items reduced include the unpaid commission fee to the National Election Commission at 23.65 billion won, road construction compensation costs for the Bugok local road at 19 billion won, and contributions to the Gyeonggi Credit Guarantee Foundation at 16.35 billion won.
As part of a responsible response to the fiscal emergency, the province cut 22.2 billion won in administrative operating expenses, including office management costs, and reduced business promotion budgets for senior officials at the third grade and above by 400 million won. Non-essential overseas business trips and training programs have been suspended. The Gyeonggi Provincial Assembly joined the effort by voluntarily cutting 1.4 billion won in overseas travel expenses for assembly members and secretariat staff, along with 900 million won in personnel costs.
Using the funds secured through these measures, the province allocated 246.4 billion won to welfare programs that had not been included in the original 2026 budget.
The second supplementary budget will be reviewed at the 393rd extraordinary session of the Gyeonggi Provincial Assembly, running from Sept. 1 to Sept. 18. The province said it plans to work closely with the assembly during deliberations and, once the budget is finalized, will draw up execution plans for each department and move quickly to implement the programs.
"We have done our utmost to protect programs that are truly necessary for people's livelihoods while carrying out the most rigorous restructuring possible within our means," Jeong said. "We will prioritize the recovery of the people's economy, support for vulnerable groups, and the safety of residents, and manage our limited finances as efficiently as possible."
Governor Choo officially declared a fiscal emergency for Gyeonggi Province on Aug. 5, a move widely seen as tantamount to declaring a moratorium.
fob140@heraldcorp.com
