SUWON — Gyeonggi Province is cutting more than 500 billion won ($360 million) in spending, citing falling tax revenue and fiscal strain, and the fallout is spreading across the province. Parts of the "opportunity income" program, a signature policy of the province's eighth popularly elected administration, are effectively heading toward suspension, while cuts to matching projects with cities and counties and to affiliated agencies have drawn growing objections from the culture and sports sectors, local governments and public institutions.
According to reporting by The Seoul Economic Daily, the province submitted its second supplementary budget for 2026 to the provincial council on the 19th of last month, totaling 42.242 trillion won after a reduction of 546.5 billion won from the existing budget. The province said restructuring spending is unavoidable if it is to channel limited resources into livelihood programs first and secure fiscal soundness.
The scope of the cuts is broad. An analysis of the supplementary budget by the People Power Party caucus in the Gyeonggi Provincial Council found that about 1,300 of roughly 2,700 provincial programs were targeted for reductions.
A prime example is the "opportunity income" program, which former Governor Kim Dong-yeon pursued as a core policy of the eighth popularly elected administration. The 21.5 billion won for farmers and fishermen was preserved, but opportunity income for people with disabilities, artists, athletes and child care was cut. Related budgets including RE100 — meeting 100% of electricity use with renewable energy — were reduced by 16.9 billion won. Opportunity income for artists and athletes had been allocated 5.05 billion won and 1.2 billion won respectively, but with unspent funds being returned, the programs' continuation has become uncertain.
Jung Doo-seok, head of the province's planning and coordination office, said the province "pursued restructuring to protect programs closely tied to residents' lives, even under difficult fiscal conditions."
Objections to the scaled-back programs have followed one after another. Jeon Young-il, a sculptor working in Paju, said, "Whenever finances get tight, the culture and arts budget is the first thing they touch. In the end, artists are the first to be hurt." Ryu Yeon-bok, chairman of the Korean People Artist Federation, said, "It is hard to accept scrapping an existing program when even creating new support systems for artists would not be enough," adding, "There is also a fairness problem, given that opportunity income for farmers and fishermen is being maintained." An official at a city sports council said the support "may not have been large for athletes, but it was meaningful, and now it is suddenly disappearing."
The 31 cities and counties that share program costs with the province are also on edge. When provincial funding falls, they must either put in additional municipal money to keep projects already under way or scale those projects back.
According to the council's People Power Party caucus, the province cut 136.7 billion won in local bonds earmarked for social overhead capital projects such as road widening and paving and river maintenance, and redirected the money to other SOC work, projects matched with national funding and general programs. The party criticized the move as effectively a roundabout new issuance of local bonds.
Of particular concern is the shrinking of matching projects closely tied to residents' daily lives, including public transit, welfare and neighborhood infrastructure. One municipal head said, "We can't just stop projects we have already started because provincial funding was cut," adding, "I'm worried the cities and counties may end up shouldering the shortfall."
Agencies affiliated with the province were also targeted. Contributions to the Gyeonggi Credit Guarantee Foundation were cut by about 16 billion won, while operating funds were reduced by about 9 billion won for the Gyeonggi Tourism Organization, about 7 billion won for the Gyeonggi Arts Center, about 6 billion won for the Gyeonggi Institute of Market and Commercial Districts and about 5 billion won for the Gyeonggi Research Institute.
Agencies facing smaller budgets must now adjust the timelines of existing projects or reconsider new ones. Concerns have been raised that disruptions could ripple across support for small business owners, tourism, culture and the arts, and policy research.
Whether the supplementary budget survives the council's review intact is another variable. The People Power Party agrees on the need to restructure spending but says there are problems with what is being cut and how, and is bracing for a tough review.
Yoon Jong-young, policy committee chair of the People Power Party caucus in the Gyeonggi Provincial Council, said it is true that the province's fiscal position has deteriorated as policies from the seventh and eighth popularly elected administrations piled up. But he called the supplementary budget "a stopgap that puts off the foundational investment that will determine the province's development, breaks promises made to cities and counties, and fills the funding gap by shifting the burden onto bureaus and affiliated agencies, and even onto the private sector."
