The prospect of passing an 11 trillion won ($9.8 billion) supplementary budget in the near future appeared grim, as rival parties continued to clash over the witness list for a separate parliamentary hearing on a controversial government-led restructuring program.

The ruling Saenuri Party and opposition parties continued to debate on whether high-profile government officials should testify on allegations that they secretly plotted a massive injection of government funds into the financially struggling shipbuilding sector.

The main opposition The Minjoo Party of Korea has been insisting that they will hold back passing the budget bill unless the Saenuri Party agrees to include the officials in the witness list. They include former Finance Minister Choi Kyung-hwan and senior presidential secretary for policy coordination An Chong-bum.

The officials allegedly held a secret meeting at Cheong Wa Dae in October last year and agreed to inject some 4.2 trillion won into Daewoo Shipbuilding & Marine Engineering Co., the nation’s No. 2 shipbuilder which has been weighed down by deficits and allegations of irregularities.

The Saenuri Party, however, has asserted that Choi and An should not be included in the list and that the bill must be passed regardless of the approval of the list. The two officials, President Park Geun-hye’s close confidants, also refused to attend the hearing.

The main parties had originally agreed to pass the budget bill on Monday. Officials said that if the plan fails to clear the legislative hurdle by the end of this month, the budget plan will be scrapped.

The government asserted that the budget bill should be passed as soon as possible to maximize its economic benefits, highlighting that a delayed implementation would make it ineffective in addressing the financial woes facing the nation.

“Timing is the key to the supplementary budget, but I’m afraid that we have passed the right timing,” Minister of Strategy and Finance Yoo Il-ho said during a meeting with government agencies. “It is unfortunate, frustrating and devastating.”

Yoo noted that the nation’s economy will face grave financial challenges in the third quarter when the government is slated to end the individual consumption tax cut and enforce the anti-graft act that some economists say will dampen consumer spending.

As a back-up plan, the Finance Ministry is reportedly planning to incorporate some of the supplementary budget into next year’s budget plan which is expected to be proposed by the government on Sep 2. But the officials expressed worries that there is little time to finish the process.

The Saenuri Party doubled its attack on the opposition bloc and accused some hard-liners of the Minjoo Party of breaking the agreement to meet the Monday deadline.

“(The Minjoo Party) is shaking up the very basic rule of parliament,” said the Saenuri Party’s floor leader Rep. Chung Jin-suk. Chung charged that the faction close to the former president Roh Moo-hyun was behind the stalemate.

The criticism came after the Minjoo Party officially endorsed a plan to conjoin their action on the extra budget bill and the witness list. The center-left party asserts that the officials in question, who oversaw the nation’s financial policy, must explain themselves before moving to discuss the new budget plan. 

“A parliamentary hearing is a prerequisite for a swift passage of the supplementary budget,” said floor leader Rep. Woo Sang-ho. “We will not agree with the budget request without hearing a proper explanation from those dealing with taxpayers’ money,”

The People’s Party, meanwhile, appeared to have a less staunch approach. The third-biggest party on Tuesday hinted at the possibility that they would yield on the witness list for the time being to pass the budget bill in time.

The centrist party’s lawmakers urged the parties to continue their negotiation at the National Assembly’s Special Committee on Budget -- a parliamentary committee designed to review the government’s budget proposal.

“The continuous deadlock (over the budget bill) only hurts our economy,” said the People’s Party interim leader Rep. Park Jie-won. “We’re sincerely hoping that the parties accept our proposal. We can both pass the budget bill and hold the hearing.”

By Yeo Jun-suk (jasonyeo@heraldcorp.com)