Rival parties tentatively agree on indirect funding for Nuri program

Senior deputy floor leaders of rival parties met on Monday to narrow key differences in allocation of budget for the "Nuri program" (childrearing subsidies for children aged 3 to 5), which emerged as a contentious issue in last-minute dispute over next year’s state budget.

For the increased portion of the Nuri program, the two sides have agreed on the indirect measure of raising fund for other budget items, instead of support from the government coffers.

The ruling Saenuri Party`s Floor Leader Kim Jae-won suggested this plan in a surprise move on the day. If the increased portion for the Nuri program budget is directly funded from the state coffers, which constitutes violation of laws, the National Assembly has to seek to an increase for other items to metropolitan and provincial education offices in order to enable the latter to set aside budget for the Nuri program with the increased amount, Kim said.

The New Politics Alliance for Democracy`s Floor Leader Ahn Gyu-baek agreed on the measure in principle. However, he suggested renegotiations, saying, “The amount of increase in next year’s budget, which is estimated at 560 billion won (500 million U.S. dollars), is different in various statistics, including those of the Education Ministry, the Strategy and Finance Ministry and metropolitan and provincial education offices.” The rival parties have agreed to hold renegotiation meetings for such specific items between their floor leaders and between the senior deputy floor leaders on Tuesday.

Meanwhile, the two sides failed to hammer out differences over other contentious issues including a hike in corporate tax. NPAD proposed a hike in corporate tax, but Saenuri rejected. Ahn suggested a discussion for at least one of the three issues-- normalization of corporate tax, a hike of the minimum tax rate by 1 percentage point from the current 17 percent, and revocation of tax exemptions and reductions. Kim declined discussions, however, saying, “They are issues beyond my capacity.” An NPAD source said, “The timing to approve next year’s budget bill will be determined based on the situation of discussion over corporate tax.”