Lee defends 162 trillion won Future Response Fund as oversight-bound fiscal tool

  • Lee rejected claims that the Future Response Fund would be a government personal slush fund.
  • The fund is approximately 162 trillion Korean won, with 12.5 trillion won earmarked for debt repayment.
  • Lee said its plan will undergo National Assembly deliberations after the fund is created next year.

Lee Hyoung-il, Deputy Prime Minister and Minister of Finance and Economy nominee, rejected opposition claims that the approximately 162 trillion Korean won Future Response Fund planned for next year would operate as a government personal slush fund. At a National Assembly confirmation hearing on the 15th, Lee said the fund’s operational plan would be submitted to the legislature for relevant deliberations. He said the fund was designed to overcome inflexible fiscal management when large excess tax revenue results from the semiconductor boom, invest in growth engines and provide a fiscal stabilization mechanism (a reserve for managing fiscal swings) during deficits. Lee said the government plans to repay 12.5 trillion Korean won in national debt, while warning that excessive repayment could affect the government bond market. Ruling Democratic Party lawmakers defended the fund as a way to save exceptional revenue for future tax shortfalls, support fiscal soundness and reduce reliance on borrowing during downturns. Lee agreed that investments generating returns above the 3–4% national bond interest rate could create greater economic effects than immediate debt repayment, and said fiscal policy should address potential-growth recovery and polarization by creating a cycle in which growth strengthens fiscal stability.

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