The National Assembly's Legislative Research Service recommended on October 8 that the government significantly enhance parliamentary oversight and approval rights regarding the proposed 'Future Response Fund' to prevent abuse of executive discretion and weaken fiscal control.
The government has established the Future Response Fund, aiming to invest in future growth drivers using increased tax revenues. In the budget proposal for 2027 announced on September 1, the government stated it plans to create a fund amounting to 162.3 trillion won next year. This plan was revealed before the revised estimates of this year's national tax revenue, which were announced on September 30. Following projections that this year's tax revenue will exceed expectations, there are concerns that more resources may flow into the Future Response Fund, raising the possibility that the fund's size could surpass 200 trillion won.
The Legislative Research Service highlighted potential issues in the fund's management, with the most significant concerns being the lack of transparency regarding fund resources and fears of bypassing the National Assembly. The method for calculating revenue estimates remains undisclosed, and as discrepancies in tax revenue forecasts increase, more funds could be allocated without parliamentary review.
Additionally, the Future Response Fund encompasses expenditures across four distinct areas under the single purpose of 'future response investment.' Given that each area has its own independent financial needs and policy objectives, the service suggested that it should be examined whether the overarching goal of future response investment justifies the establishment of a separate fund.
Other concerns raised included controversies over the relaxed scope of changes to fund management plans, issues related to the transfer of funds between general accounts, exceptions to budgetary principles, and the concentration of authority due to multi-agency fund management, which could limit committee reviews.
To address these issues, the Legislative Research Service proposed several solutions: ▲ full disclosure of the methods for estimating tax revenues and foundational data ▲ clear delineation of roles between existing accounts and the Future Response Fund ▲ strengthening the National Assembly's oversight and approval rights regarding the Future Response Fund.
* This article has been translated by AI.
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