South Korea will aggressively streamline the public sector to improve efficiency and build up competitiveness, the country’s top economic czar said Wednesday.
In a meeting with the heads of the country’s state-owned enterprises and public agencies, Finance Minister Choi Kyung-hwan said the central government plans to scrutinize the energy, environment and education sectors starting next month.
He said screening and evaluating how public organizations operate in these three sectors will allow policymakers to reduce redundancy and permit SOEs and agencies to concentrate on core areas that can enhance efficiency.
The official, who doubles as deputy prime minister in charge of economic affairs, added that policymakers will also check if operations carried out by public corporations and agencies overlap those of the private sector.
“In the case of overlap, measures will be taken to resolve such problems,” Choi said.
The minister then said under the incumbent administration, debt held by public sector corporations has been slashed by some 500 billion won ($437.1 million), while tackling waste has saved taxpayers about 200 billion won annually.
He stressed that as part of this ongoing effort, the public sector must move to fully implement peak wages for its employees.
As of early this month, the government said over 90 percent of 313 public sector corporations, reached agreements with workers to introduce the novel wage system.
The government-led wage peak system pushes the retirement age of workers back, giving them greater job security. The same people benefiting from this, on the other hand, must accept lower wages just before retirement, with the money saved used to hire new employees.
Choi then said moves by state-operated corporations to use the national competency standards criteria when hiring workers is helping to build public trust and pioneering a culture that rewards real-work capability over mere education background.
He said the government intends to open some senior positions at public corporations to outside talent that can fuel innovation and change.
On the overall state of the national economy, the finance minister said the rebound in consumer spending is helping to push up growth. He, however, cautioned that uncertainties surrounding U.S. rate hikes and the recent Paris terror attack are contributing to downside risks that need to be checked carefully. (Yonhap)
