[COVER STORY] Why Gyeonggi Province is under financial strain

Gyeonggi Province narrowly avoided disruptions to essential welfare programs after its provincial council approved a supplementary budget on Monday. The agreement restored 21.6 billion won for child care, postpartum care and other livelihood-related programs, but did not establish a lasting revenue source. The province faces falling property acquisition tax revenue, rising welfare obligations and growing debt, raising concerns about further funding shortfalls next year.

Gyeonggi Province’s debt increased from approximately 4.5 trillion won in 2023 to 6.1 trillion won in 2025, a rise of more than 36 percent.

The province’s daily debt-interest burden is expected to increase from 390 million won this year to 480 million won next year.

More than half of Gyeonggi’s approximately 16 trillion won in local tax revenue comes from property acquisition taxes.

Gyeonggi’s population grew by about 300,000 over four years, while its population aged 65 and older increased by roughly 600,000.

The provincial government proposed 546.5 billion won in spending cuts and restructuring after Gov. Choo Mi-ae declared a fiscal emergency in early August.

Published Oct 13, 2026 4:13 pm KST

Updated Oct 13, 2026 4:21 pm KST

Welfare funding restored, but growing debt leaves deeper problems unresolved

Gyeonggi Province Gov. Choo Mi-ae speaks during a parliamentary audit at the National Assembly in Seoul, Tuesday. Yonhap

Gyeonggi Province, Korea's most populous province, narrowly averted disruptions to essential welfare programs with the passage of a supplementary budget on Monday. But restoring funding for the rest of 2026 has not resolved the fundamental problem behind the crisis: falling revenue, growing spending obligations and fewer resources to bridge the gap.

With the provincial government required to submit next year’s budget proposal by Nov. 11, residents and welfare providers remain concerned and question whether the province's Gov. Choo Mi-ae can prevent further funding shortfalls.

What did Monday’s agreement resolve?

The provincial council approved the supplementary budget after last-minute negotiations restored 21.6 billion won ($16 million) for livelihood-related programs, including support for child care and postpartum care.

The agreement broke a monthlong impasse over funding needed to keep essential services running through the final quarter. Some welfare programs had been allocated only nine months of funding, leaving them facing suspension this month and prompting protests by child care workers, teachers and residents.

The dispute followed Choo’s declaration of a fiscal emergency in early August. The province subsequently proposed 546.5 billion won in spending cuts and restructuring.

Monday’s deal restored some essential funding. It did not create a lasting revenue source to pay for those programs.

Korea Times graphic by Cho Sang-won

How did financial strain develop?

Gyeonggi’s consolidated fiscal balance has remained in deficit since 2022, which means spending has consistently exceeded revenue on that measure.

At Tuesday’s parliamentary audit of the provincial government, Choo attributed the rising debt to COVID-19 pandemic relief under then-Gov. Lee Jae Myung, the current president, and expansionary spending under his successor, Kim Dong-yeon. Falling property acquisition tax revenue compounded the pressure, she said.

Borrowing helped cover funding gaps, but increased the cost of servicing debt.

“We have issued municipal bonds on five consecutive occasions, and our daily interest burden amounts to 390 million won this year and will rise to 480 million won next year,” she said.

The province’s budget has exceeded 40 trillion won, but this doesn’t mean it has ample discretionary funds. Choo said the budget’s size could mask the extent of rising debt when expressed as a percentage of the huge total.

Gyeonggi’s debt rose from approximately 4.5 trillion won in 2023 to 6.1 trillion won in 2025, an increase of more than 36 percent — roughly three times the average increase of 12.7 percent among metropolitan and provincial governments nationwide — while the liabilities-to-assets ratio exceeded 15 percent, the highest in the country, she added.

Why are revenue and spending out of balance?

Beyond rising debt, the province faces a mismatch between unstable tax revenue and growing welfare needs.

"More than half of Gyeonggi's some 16 trillion won in local tax revenue comes from property acquisition taxes," Choo said, adding that this structure leaves its finances vulnerable to property markets.

Demand for essential services, however, continues to grow. Over the past four years, the province’s population increased by about 300,000, while the number of residents aged 65 and older rose by roughly 600,000. Around 77,000 babies were born there last year, she added. These changes create demand for elderly care and child care regardless of property market conditions.

The chip industry presents another imbalance. As major semiconductor companies' plants are located in the province, the provincial government has helped fund infrastructure serving the industry, but corporate local income taxes go to the cities and counties hosting the businesses, not the provincial government, according to the relevant taxation laws. The industry’s prosperity, as a result, does not automatically mean more revenue for the province.

"We need more money to spend while the revenue base to support this remains unstable. It is time to fundamentally reform this fiscal structure," Choo said.

Why has Choo drawn criticism?

The debate also concerns how fairly austerity is being shared.

While her administration has cut staff expenses citing a fiscal emergency, the province arranged an apartment lease deposit of approximately 1.2 billion won for her official residence. A 77 million won official vehicle has also drawn criticism.

Choo defended the residence at the audit, saying the deposit will be returned when the lease ends.

“I don’t think it would be fair to describe that as lavish or extravagant,” she said.

She also said the vehicle purchase had been decided before she took office.

Could another funding dispute happen?

For now, Monday’s agreement relieved the sudden funding depletion for welfare programs, but concerns remain about next year’s funding.

Choo has called for changes to local taxation and the province’s fiscal structure to secure a more stable revenue base. Without a lasting solution, essential programs could face funding shortfalls again.

A provincial assembly member said legislators were determined to prioritize child care and education spending, particularly funding affecting teachers’ pay and working conditions, but could not guarantee next year’s allocations.

京畿道议会周一批准了一项补充预算，勉强避免了基本福利项目中断。该协议恢复了216亿韩元的资金，用于儿童保育、产后护理和其他与民生相关的项目，但并未建立可持续的收入来源。京畿道面临着房产购置税收入下降、福利支出增加和债务增长的困境，这引发了人们对明年资金进一步短缺的担忧。

京畿道债务从 2023 年的约 4.5 万亿韩元增加到 2025 年的 6.1 万亿韩元，增幅超过 36%。

该省每日债务利息负担预计将从今年的3.9亿韩元增加到明年的4.8亿韩元。

京畿道约 16 万亿韩元的地方税收中，超过一半来自房产购置税。

京畿道人口在四年内增长了约 30 万，而 65 岁及以上人口增加了约 60 万。

8月初，省知事秋美爱宣布进入财政紧急状态后，省政府提议削减开支和进行结构调整，总额达5465亿韩元。

发布于2026年10月13日下午4:13（韩国标准时间）

更新于2026年10月13日下午4:21（韩国标准时间）

福利资金已恢复，但不断增长的债务使更深层次的问题仍未得到解决。

京畿道知事秋美爱周二在首尔国会出席国会审计听证会并发表讲话。（韩联社）

韩国人口最多的京畿道周一通过了一项补充预算，勉强避免了基本福利项目中断。但恢复2026年剩余时间的资金并未解决危机背后的根本问题：收入下降、支出义务增加以及弥补资金缺口的资源减少。

由于省政府必须在 11 月 11 日前提交下一年度的预算提案，居民和福利机构仍然感到担忧，并质疑省长朱美爱能否防止资金进一步短缺。

周一达成的协议解决了什么问题？

经过最后一刻的谈判，省议会批准了补充预算，恢复了 216 亿韩元（1600 万美元）用于与生计相关的项目，包括对儿童保育和产后护理的支持。

该协议打破了长达一个月的僵局，僵局的焦点在于维持基本服务在最后一个季度正常运转所需的资金。一些福利项目仅获得了九个月的拨款，这意味着它们本月将面临暂停，这引发了托儿工作者、教师和居民的抗议。

这场争端源于秋美贤8月初宣布进入财政紧急状态。随后，该省提出了削减开支和进行结构调整的5465亿韩元方案。

周一达成的协议恢复了一些必要的资金，但并没有建立起支付这些项目费用的持久收入来源。

《韩国时报》图表，作者：赵相元

财务压力是如何产生的？

自 2022 年以来，京畿道的综合财政收支一直处于赤字状态，这意味着该指标的支出持续超过收入。

在周二的国会审计省政府时，秋美贤将债务上升归咎于时任省长李在明（现任总统）执政期间的新冠疫情纾困措施，以及其继任者金东渊执政期间的扩张性支出。她表示，房产购置税收入的下降加剧了债务压力。

借贷有助于弥补资金缺口，但也增加了偿债成本。

“我们已经连续五次发行市政债券，今年的每日利息负担为3.9亿韩元，明年将增至4.8亿韩元，”她说。

该省的预算总额已超过40万亿韩元，但这并不意味着它拥有充足的可支配资金。Choo表示，如果以占总预算的百分比来衡量，预算规模可能会掩盖债务不断增长的程度。

她补充说，京畿道的债务从 2023 年的约 4.5 万亿韩元增至 2025 年的 6.1 万亿韩元，增幅超过 36%——大约是全国各大都市和省级政府平均增幅 12.7% 的三倍——同时，其负债资产比率超过 15%，是全国最高的。

为什么收入和支出不平衡？

除了债务不断增加，该省还面临着税收收入不稳定和福利需求不断增长之间的不匹配问题。

“京畿道约16万亿韩元的地方税收中，超过一半来自房产购置税，”秋说道，并补充说，这种结构使得京畿道的财政容易受到房地产市场的影响。

然而，对基本服务的需求仍在持续增长。过去四年，该省人口增加了约30万，而65岁及以上居民人数增加了约60万。她补充说，去年该省约有7.7万名婴儿出生。无论房地产市场状况如何，这些变化都会增加对老年护理和儿童保育的需求。

芯片产业呈现出另一种不平衡的局面。由于大型半导体公司的工厂都位于该省，省政府也资助了该产业的基础设施建设，但根据相关税法，企业缴纳的地方所得税归企业所在地的市县所有，而非省政府。因此，该产业的繁荣并不一定意味着省政府能获得更多收入。

“我们需要更多资金用于支出，但支撑这些支出的收入基础仍然不稳定。现在是时候从根本上改革财政结构了，”朱说。

为什么秋美珠会受到批评？

这场辩论还涉及紧缩政策是否公平分配的问题。

尽管她的政府以财政紧急情况为由削减了人员开支，但该省仍为其官邸支付了约12亿韩元的公寓租赁押金。一辆价值7700万韩元的公务用车也引发了批评。

在审计中，Choo 为该住所辩护，称租约到期时将退还押金。

“我觉得用奢华或铺张浪费来形容它并不公平，”她说。

她还表示，购买这辆车的决定在她上任之前就已经做出了。

是否可能再次发生资金纠纷？

目前，周一达成的协议缓解了福利项目资金突然枯竭的问题，但人们仍然担心明年的资金问题。

秋美飒呼吁改革地方税收制度和省财政结构，以确保更稳定的收入基础。如果找不到长久的解决方案，一些重要项目可能再次面临资金短缺。

一位省议员表示，立法者决心优先考虑儿童保育和教育支出，特别是影响教师工资和工作条件的资金，但无法保证明年的拨款。