Seoul: The National Assembly on Tuesday passed next year's budget of 727.9 trillion won (US$498 billion) that calls for more spending to prop up the economy and on national defense, as rival parties reached a last-minute agreement to maintain the government's proposed total spending. The Assembly approved the 2026 budget plan during a plenary session, just minutes before the legal deadline.

According to Yonhap News Agency, the breakthrough came earlier in the day when the ruling Democratic Party and the main opposition People Power Party (PPP) agreed to keep key budget items related to President Lee Jae Myung's signature initiatives, including a local gift certificate program, at the proposed level. The parties decided to scale back 4.3 trillion won from artificial intelligence-related programs, policy funds and other items, while reallocating the same amount to other areas, leaving the total budget unchanged.

Funding will be increased in other areas, such as establishing a disaster-recovery system following a massive fire at a state data center, as well as fostering the distributed power grid industry and expanding national scholarships. The rival parties had wrangled over next year's budget for weeks, with the PPP calling for budget cuts in the local gift certificate program and other items.

It marked the first time in five years that the National Assembly has met the legal deadline for budget approval.