Super Economy Ministry to Be Created
By Lee Hyo-sik
Staff Reporter
The incoming administration's blueprint to restructure government organizations will create a gigantic economic ministry that oversees the country's macroeconomic policies and fiscal budget. Also, the overhaul plan will establish a comprehensive state agency to supervise the financial industry.
President-elect Lee Myung-bak's transition committee Wednesday unveiled the comprehensive scheme aimed at streamlining government. The committee said the proposed plan is designed to increase organizational efficiency through mergers of similar functions scattered from one ministry to another, reduce state expenditure and help boost economic activity.
Under the plan, the current 18 ministries will be cut to 13 through a series of consolidations among ministries and the number of civil servants will decrease by 7,000 in the process.
Among changes, the Ministry of Finance and Economy will be merged with the Ministry of Planning and Budget, creating a larger ministry called ``the Ministry of Planning and Finance,'' which will manage the country's macroeconomic policies and fiscal budget.
The envisioned ministry will likely be able to implement economic policies in a more coherent manner and increase policy effects as it will be empowered to set and control government spending.
The Ministry of Finance and Economy, the government's top economic policymaking body, has often faced difficulties in coordinating policies with other economy-related ministries and was often forced to change its policy course when it failed to secure budget.
The ministry in general is welcoming its merger with the budget ministry as it will be able to draw up and manage the government coffer even though the minister of planning and finance will no longer be deputy prime minister. Ministry officials also expect to exert a greater influence on other government bodies and boost the coordination role among agencies.
However, they expressed concerns that the planned integration may lead to massive manpower restructuring as the combined number of civil servants will total nearly 1,200. They say several hundreds of officials could be forced to retire and find jobs elsewhere.
``We welcome a merger with the Ministry of Planning and Budget. But many are worried that some of us could be laid off in the merger process. In particular, senior officials will likely be affected first as the incoming administration will implement personnel reshuffle, including vice ministers and director general-level officials,'' a ministry official said.
But critics argue that with more power in hand, the envisioned ministry is more likely to arbitrarily decide the country's economic policy course and could abuse its authority of appropriating state expenditure.
In the meantime, the incoming government is planning to take financial policymaking functions away from the Ministry of Finance and Economy to create the so-called the Financial Committee by combining them with the Financial Supervisory Commission. The Financial Supervisory Service consisting of private financial experts will remain intact.
The presidential transition committee said the envisioned agency will be empowered to both draw up financial policies and supervise the financial market to increase financial policy efficiency and help the government deal with changes more promptly in the rapidly-changing marketplace. The agency will also be overseeing the Korea Development Bank and other state-run banks, as well as a number of state financial funds.
But critics contend the planned Financial Committee could misuse its power and create more financial regulations.