Gyeonggi Province Declares 'Financial Emergency,' Cuts 546.5 Billion Won in Budget for Essential Public Services

Gyeonggi Province, which officially declared its financial situation as an 'emergency,' has implemented strong budget cuts of 546.5 billion won to protect essential public services including livelihood support for vulnerable groups, childcare, responses to low birth rates, resident safety, and welfare and medical projects.

Jung Du-seok, head of Gyeonggi Province's Planning and Coordination Office, held a press conference at the Gyeonggi Provincial Government office on July 19 and announced that the province will submit the second supplementary budget for 2026, totaling 42.242 trillion won, to the Gyeonggi Provincial Assembly.

Director Jung stated, "Although the province's financial situation is challenging, we have pursued comprehensive expenditure restructuring to protect essential public services directly linked to residents' lives. We plan to address the financial emergency by prioritizing limited resources for necessary projects," explaining the background of the supplementary budget compilation.

This supplementary budget was compiled to respond to worsening financial conditions due to an anticipated 300 billion won shortfall in local taxes, particularly acquisition taxes, the primary tax source for the province, resulting from sluggish real estate transactions, cumulative debt burdens, and the near-exhaustion of available funds, while ensuring the smooth implementation of essential public services without disruption.

The province implemented strong expenditure restructuring by adjusting event-related and one-time projects as well as similar and redundant projects, and comprehensively reviewing project scale and implementation timing, resulting in budget cuts totaling 546.5 billion won from existing budgets.

Major expenditure reductions include: △untransmitted electoral commission entrusted funds of 23.648 billion won △compensation for Bugok national local road construction of 19 billion won △contributions to the Gyeonggi Credit Guarantee Foundation of 16.35 billion won, among other project budget adjustments.

Additionally, the province has taken responsibility in response to the financial emergency by reducing administrative operation expenses such as office management costs by 2.22 billion won and cutting official business promotion funds for grade 3 and above high-ranking government officials by 400 million won. Unnecessary and non-essential overseas business trips and training programs are also being discontinued or minimized. Meanwhile, the Gyeonggi Provincial Assembly also participated in expenditure restructuring by independently cutting 1.4 billion won in overseas travel expenses for provincial assemblymen and assembly office staff and 900 million won in personnel costs.

With the funds secured this way, the province has allocated 246.4 billion won for public service projects that could not be reflected in the 2026 main budget.

Major projects include: △long-term care facilities for the elderly and home care services of 123.4 billion won △school meal support for kindergarten, elementary, middle, and high schools under the Provincial Office of Education of 58.4 billion won △Gyeonggi Province farmer and fisherman opportunity income support of 21.5 billion won △Gyeonggi Province youth basic income of 16.3 billion won △meal support for children suffering from food insecurity of 7.5 billion won △school meal support for environment-friendly and high-quality agricultural and livestock products of 3.5 billion won △operation support for transportation assistance centers of 3.7 billion won.

A total of 86.3 billion won has been allocated to respond to the low birth rate crisis and essential welfare and medical projects. △infertility couple procedure support of 22.3 billion won △maternal and newborn health management support of 11.5 billion won △children and youth transportation cost support of 6 billion won △disability activity assistance allowance of 3 billion won are included to ease the burden of childbirth and child-rearing and minimize welfare gaps. Additionally, budgets have been allocated for essential medical projects including △medical assistance of 38.9 billion won △national preventive vaccinations of 600 million won.

A total of 29.8 billion won has been allocated to high-priority railway and road SOC projects. In this supplementary budget, projects scheduled for completion within the year or those that require execution this year, such as land compensation reconsiderations, were selected. Major projects include: △Dobongsan-Okjeong metropolitan railway of 4.2 billion won △Anseong Gongdo-Yangseong road expansion and paving project of 4.1 billion won △Hwaseong Wujeong-Hyangnam road expansion and paving project of 3 billion won.

Gyeonggi Province's second supplementary budget is scheduled to be reviewed at the 393rd interim session of the Gyeonggi Provincial Assembly, which will be held from September 1 to 18. Gyeonggi Province plans to work closely with the provincial assembly during the review process, and once the budget is finalized, will establish implementation plans for each department to swiftly promote projects.

Previously, Gyeonggi Province Governor Choo Mi-ae officially declared the province's financial situation as an 'emergency' on July 5.