Gyeonggi-do Implements '3 Major Budget Reduction Management Guidelines' Starting This Month

Specific Procedures for All Processes from Business Planning Stage to Construction

[Asia Economy Reporter La Young-cheol] Gyeonggi Province announced on the same day that it has finalized the enactment of the "Gyeonggi Province Public Construction Project Total Project Cost Management Guidelines," which include three major budget-saving policies for construction projects, and will implement them starting November 1.

According to the province, the guidelines specify standards and procedures to manage project costs rationally and systematically throughout the entire process of public construction projects in the province, from the project planning stage to design, ordering, contracting, and construction.

At each project implementation stage, the total project cost, project scale, and project duration must be consulted with the project management agency (department), fundamentally preventing arbitrary project plan changes by the project executing agency.

The scope of application covers public construction projects with a total project cost of 500 million KRW or more and a project duration of two years or longer, funded by the provincial budget or funds. This includes the provincial government headquarters, business offices, municipalities or counties acting on behalf of projects supported by the provincial budget, and provincial-affiliated institutions.

The guidelines feature the introduction of total project cost management at the provincial level, mandatory application of the standard market unit price for public construction projects under 10 billion KRW, and measures to resolve indirect costs caused by construction period extensions?collectively referred to as the "three major budget-saving policies for construction projects."

The guidelines include a clause mandating the review of the standard market unit price for public construction projects under 10 billion KRW, requiring the calculation of design details applying both the standard quantity and the standard market unit price, followed by adjustments and submission for appropriateness review.

They also contain measures to resolve indirect costs caused by construction period extensions, stipulating that local road construction must commence only after securing land use rights, thereby blocking the causes of indirect cost generation.

However, for national and local road construction projects, the guidelines of the Ministry of Economy and Finance and the Ministry of Land, Infrastructure and Transport, rather than the provincial guidelines, will apply.

The province plans to distribute manuals related to the guidelines to each city, county, and public institution within this month to ensure the system is stably established as soon as possible.

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