Systematization of Financial Project Performance Management... Change of National Bond Issuance Limit to 'Net Issuance Amount'

Promotion of Amendments to the National Finance Act to Strengthen Performance Management
'Partial Amendment to the National Finance Act' Approved at the Cabinet Meeting

[Asia Economy Reporter Kwangho Lee] The government has established a separate chapter on fiscal project performance management to systematize fiscal project performance management and strengthen its legal basis. Additionally, in response to the recent increase in government bond issuance, the government decided to clarify national debt control and change the National Assembly's approval criteria for bond issuance limits from total issuance amount to net issuance amount to enhance future refinancing risk management and market management capabilities.

The government announced that at the 50th Cabinet meeting held on the 29th, it reviewed and approved the "Partial Amendment to the National Finance Act" containing these provisions.

This amendment aims to strengthen and systematize regulations on fiscal project performance management amid the expanding role of fiscal policy, establishing a performance-oriented fiscal management foundation that the public can feel. It also includes changing the National Assembly's approval criteria for bond issuance from the current total issuance limit to a net issuance limit to improve the efficiency of bond management and bond market operations.

First, principles such as efficiency, fairness, and transparency were newly established as the principles of fiscal project performance management, and the Minister of Strategy and Finance was tasked with formulating a basic performance management plan and an implementation plan to promote more systematic performance management.

Furthermore, each ministry is required to establish a performance management promotion system, including a Fiscal Performance Officer (Deputy Minister) and a Fiscal Performance Operations Officer, and to reflect the results of performance management in their organization, personnel, and budget. The results of performance target management are to be reported annually to the Cabinet meeting.

In addition, to enhance accountability and transparency in fiscal project performance management, a performance information system that systematically manages performance information will be established and operated, and efforts to disclose performance information will be made mandatory.

The government also decided to change the National Assembly's approval criteria for bond issuance limits from total issuance amount to net issuance amount. However, this excludes refinancing issuance cases where there is no increase in national debt.

Moreover, a provision was newly established to electronically link the budget accounting system operated by the Ministry of Strategy and Finance with related agencies' financial work systems, including central, local, and educational finance, laying the foundation for integrated fiscal information production.

A government official stated, "We plan to promptly submit the approved amendment bill to the National Assembly and strive for its swift passage," adding, "Going forward, fiscal management will be more performance-based, and fiscal information will be transparently disclosed to the public to enhance efficiency, accountability, and reliability in fiscal affairs."

This content was produced with the assistance of AI translation services.