The presidential office said on the 26th that the planned Future Response Fund is meant to "break away from the existing approach to fiscal management, in which the government spends a lot when tax revenue comes in high and spends nothing when it comes in low." Officials stressed that excess tax revenue would be set aside and invested where it is needed, while pushing back against criticism that the fund could become a slush fund for the government.
The government had earlier outlined a plan to create the Future Response Fund rather than spend within the same year the tax revenue collected beyond projections on the back of a semiconductor boom, and to concentrate investment in four areas: young adults, growth engines, regional development and education and talent.
An official at the presidential office met with reporters at the Chunchugwan press center that day and said of the slush fund criticism, "We cannot spend it freely without the National Assembly's approval," adding that the fund would be "thoroughly subject to control by the National Assembly." The official also said, "One of the main purposes of the Future Response Fund is fiscal stabilization," explaining that "if a shortfall arises in the general account, we will clearly stipulate that it be covered, rather than resorting to the irregular fiscal management of the past." The official repeated that the fund "cannot become a slush fund."
Park Sung-hoon, head of the Future Response Fund task force at the Ministry of Planning and Budget, appeared on the presidential office's YouTube channel that day and also rebutted the slush fund criticism, saying, "Like the budget and other funds, the Future Response Fund is designed to be subject to the National Finance Act and the National Assembly Act."
The presidential office emphasized in particular that the fund would serve as a "fiscal reservoir" for the future. The official said, "Spending everything through supplementary budgets when tax revenue surges on a semiconductor boom, and then writing it off as unused when the cycle ends and revenue falls short, is not responsible fiscal management." The official added, "We will invest through the Future Response Fund for responsible fiscal management," and said, "Funding is needed for mega-projects investing in new industries that prepare for the future and for future investment in the seven areas known as the 'seven seeds.'"
The goal is to invest in future growth industries, including the next-generation advanced industry seed projects the government has announced — small modular reactors, nuclear fusion, quantum technology and aerospace — alongside artificial intelligence and semiconductors.
The presidential office also distanced itself from arguments that additional tax revenue should first be used to pay down national debt. The official said, "We are currently issuing about 110 trillion won in government bonds to cover the deficit, and some argue it would be better to reduce bond issuance using tax revenue. That is not entirely wrong, but what do we do the year after next?" The official added, "There is no certainty that tax revenue will come in high the year after next."
The official continued, "Issuing bonds one year and not the next is not stable," and said, "As President Lee Jae-myung said at a Cabinet meeting, if spending 10,000 won today can create 1 million won tomorrow, then an investment that brings greater returns in the future would be appropriate — that is the thinking behind creating the Future Response Fund."
The government also plans to actively manage the money accumulated in the fund. Park said, "We are not going to let the money sitting in the fund idle," adding, "We plan to select a dedicated management institution to run it." He also said, "The yield on three-year government bonds is around 3.8%, and we plan to manage the fund targeting returns above that."
