In the 2013 fiscal year, the amount of government support for the 304 institutions that are designated as public institutions as of Jun. 2014 was 51.9 trillion won, and the size of the public institutions’ debt was 523.2 trillion won in 2013, reaching 108.4% of the national debt of 482.6 trillion won.
Public institutions are conducting projects stipulated in laws based on diverse sources of budget including burden charges, income based on consignment and monopoly, and their own income as well as the government’s investment, contribution, and support. However, the National Assembly’s review on public institutions’ settlement of accounts is focused only on projects involving the government’s investment, contribution, and support. Therefore, there is a need to comprehensively evaluate the performance of the public institutions, including on projects conducted based on public institutions’own income.
The evaluation results show that the total cost of interest of non-financial public institutions with more than 500 billion won in financial debt was 12.6 trillion won in 2013, and therefore the management responsibility of the competent authorities should be reinforced. In addition, it is found that sales of shares,/adjustment of business scope, and improvement of management methods are needed at public institution-invested companies, and that there is not clear legal grounds or specific standards on financial support with regard to contributions and subsidies for public institutions.
Moreover, it is pointed out that more information should be disclosed through the Public Institution Management Information System and the credibility of the disclosed information should be improved. As for maintenance of irrigation facilities by the Agriculture and Fishery Development Corporation, among the projects supported by national subsidy, it is pointed out that the methods of projects and financing should be changed. It is also pointed out that the expected impact on the reduction of public institutions’ debt from the introduction of REITs should be re-examined.
Public institutions are conducting projects stipulated in laws based on diverse sources of budget including burden charges, income based on consignment and monopoly, and their own income as well as the government’s investment, contribution, and support. However, the National Assembly’s review on public institutions’ settlement of accounts is focused only on projects involving the government’s investment, contribution, and support. Therefore, there is a need to comprehensively evaluate the performance of the public institutions, including on projects conducted based on public institutions’own income.
The evaluation results show that the total cost of interest of non-financial public institutions with more than 500 billion won in financial debt was 12.6 trillion won in 2013, and therefore the management responsibility of the competent authorities should be reinforced. In addition, it is found that sales of shares,/adjustment of business scope, and improvement of management methods are needed at public institution-invested companies, and that there is not clear legal grounds or specific standards on financial support with regard to contributions and subsidies for public institutions.
Moreover, it is pointed out that more information should be disclosed through the Public Institution Management Information System and the credibility of the disclosed information should be improved. As for maintenance of irrigation facilities by the Agriculture and Fishery Development Corporation, among the projects supported by national subsidy, it is pointed out that the methods of projects and financing should be changed. It is also pointed out that the expected impact on the reduction of public institutions’ debt from the introduction of REITs should be re-examined.