Yoon Seok-yeol's Garden Reduction Public Institution Innovation Plan: "Cut Non-Core Tasks and Executives"

Reducing Public Institution Executives and Adjusting Executive-Level Ranks
Yoon Seok-yeol's Consistent "Public Institution Reform" Since Early Administration
4,000 Reassigned in Key Areas Including National Tasks and Safety
Public Institution Unions Protest, Demand Halt to Workforce Reduction Policy

The innovation plan passed by the Public Institution Management Committee on this day includes measures for function adjustment, organizational and personnel efficiency, and reduction of authorized and actual personnel. While previous public institution policies focused on reducing budgets or welfare, this time the core is to reduce the workforce itself. With the announcement of the five major innovation plans for public institutions under the Yoon Seok-yeol administration, the government plans to conduct performance reviews and identify additional improvement tasks.

Cut All Non-Core Tasks and Excessive Executives

Choi Sang-dae, the 2nd Vice Minister of the Ministry of Economy and Finance, is announcing the finalized plan for adjusting public institution functions and optimizing organization and manpower at the briefing room of the Government Seoul Office Building on the 26th.
[Image source=Yonhap News]

Function adjustment focuses on reorganizing tasks that compete with the private sector or local governments, non-core tasks, or those with decreased demand or project termination. Similar or overlapping tasks among institutions will also be streamlined. A total of 717 cases will be improved, reducing 7,231 personnel across 233 institutions. The operation of the Bundang and Ilsan Olympic Sports Centers is a representative improvement case. These sports centers are managed by Korea Sports Industry Development, but will be transferred to the private sector to enhance expertise.

Organizational and personnel efficiency will also be promoted. Organizations will be integrated or consolidated into larger departments, and local and overseas organizations will be optimized. Support personnel will be adjusted and work processes reorganized. The target institutions number 228, with 4,867 personnel adjustments planned. According to the improvement plan, the Korea Tourism Organization will close three overseas branches and consolidate two domestic branches. The Korea Student Aid Foundation will optimize support personnel in management support and information management or integrate tasks.

Senior positions will also be reduced. In a total of 61 institutions, the excessive ratio of executives will be lowered, or higher-level institutions performing similar tasks will be merged or abolished. The Korea Technology Finance Corporation was judged to have an excessive number of executives compared to similar institutions, reducing the number from 8 to 7. The Korea Creative Content Agency also adjusted the ranks of six separate positions that received executive treatment.

Even after considering factors such as parental leave and part-time work, the persistent gap between authorized and actual personnel in each institution will be resolved. A total of 5,132 personnel will be reduced across 157 institutions, with Korea Expressway Service Co., Ltd. having the largest reduction of 971. KEPCO MCS Co., Ltd. will reduce 440, and the Post Office Facilities Management Group 417, among others.

On the other hand, in some cases, 4,788 personnel will be redeployed, increasing the workforce. In core national projects such as the construction of Shin-Hanul Units 3 and 4 by Korea Hydro & Nuclear Power, 2,577 personnel will increase. Essential facilities like the operation of the West Power Gimpo Combined Heat and Power Plant and safety-related areas such as disaster prevention in the Korea Railroad Corporation, urban flooding, and safety response will also see workforce expansion. For safety-related personnel, 80 essential personnel submitted by institutions were excluded from personnel adjustments, and all 646 requested redeployments were accepted.

Yoon Drives Public Institution Reform from the Start

President Yoon Seok-yeol speaking at the Cabinet meeting held on June 21 at the Yongsan Presidential Office Building in Seoul. [Image source=Yonhap News]

President Yoon Seok-yeol has expressed his intention to reform public institutions from the beginning of his administration. On June 21, during a Cabinet meeting, President Yoon stated, “Innovation in public institutions is an urgent task that can no longer be postponed,” adding, “Public institution evaluations must be strict, and areas that have been operated wastefully must be boldly improved. The innovation of 350 public institutions is a task that all ministries must pursue together.”

Participants in the Cabinet meeting also agreed that public institutions had grown excessively during the Moon Jae-in administration and that innovation was necessary. Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho mentioned the average wages of public institution employees and moral hazard. He emphasized, “The wasteful operation and parties of public institutions under the Moon Jae-in administration are over.”

Subsequently, the government pursued the ‘Three Major Tasks for Public Institution Innovation’ aimed at improving efficiency and enhancing public service quality: ▲Increasing productivity in the public sector ▲Autonomous and responsible management and capacity building ▲Strengthening cooperation between private and public institutions. On June 30, the ‘Financial Risk Institution Intensive Management System’ was introduced, and about a month later, on July 29, the ‘New Government Public Institution Innovation Guidelines’ were released. In August and September, plans for restructuring the public institution management system and private-public cooperation measures were announced consecutively.

The first focus was on budget and welfare. According to the innovation guidelines, institutions prepared innovation plans, and on October 17, budget efficiency and welfare improvement plans were reviewed and finalized. Through this, 1.1 trillion KRW in current expenses for this year and next year were saved or cut. In-house loans were improved in 715 cases across 15 items. The asset efficiency plan announced last month also led to the sale and reorganization of non-core real estate and unnecessary assets worth 14.5 trillion KRW.

Minimizing Reduction in New Hiring, Strong Union Opposition

On the 26th, public institution labor unions held a rally in front of the Seoul Government Complex in Jongno-gu, Seoul, opposing the Yoon Suk-yeol administration's public institution reform plan. Photo by Song Seung-seop tmdtjq8506@

This workforce reduction plan was also implemented based on plans prepared and submitted by the relevant ministries and 350 public institutions according to the guidelines. The government formed a joint public-private ‘Public Institution Innovation Task Force (TF)’ to finalize the plan. With the personnel adjustment plan passing the Public Institution Management Committee, all five innovation guideline plans (function, organization and personnel, budget, assets, welfare) were finalized.

However, the government intends to minimize the impact on new hiring. When asked by reporters whether new hiring in public institutions would also decrease in the future, Vice Minister Choi said, “We have given considerable thought to youth employment issues,” adding, “Adjustments will not be made all at once but over 2 to 3 years, considering retirements and resignations to minimize the reduction in youth hiring.”

Meanwhile, public institution labor unions held rallies in front of the Seoul Government Complex on the same day, protesting and demanding a halt to the workforce reduction policy in public institutions.

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