From This Year, 'Blind Legislation' Without Budget Plans Is Not Allowed

Ministry of Legislation Requests Each Ministry to 'Cooperate with Bill Cost Estimation'
Government and National Assembly Attempt Legislation Without Knowing Costs
National Assembly Secretariat: "Submissions Not Accepted If Regulations Are Not Followed"

[Asia Economy Reporter Song Seung-seop] From this year, attempts by the government and the National Assembly to introduce bills without financial plans, known as ‘blind legislation,’ will become difficult. Many bills are submitted without considering the budget, even though they involve policies funded by taxes. If the revised regulations are not properly followed, bill submissions will be impossible regardless of whether they come from the government or the National Assembly.

According to various government departments on the 3rd, last month the Ministry of Government Legislation instructed all departments to cooperate in preparing cost estimation reports in the prescribed format when submitting bills to the National Assembly, as the regulations on cost estimation of legislative proposals were amended and have been in effect since January this year. According to current law, when the government or the National Assembly drafts a bill, they must write a ‘cost estimation report’ calculating how revenues and expenditures will change. If it concerns security or military policy, or if cost estimation is difficult, a ‘statement of reasons for non-attachment’ must be attached.

Under the revised regulations, bills must now be prepared with calculations of how much money each article and clause will cost. This means that detailed budget plans for each item must be submitted, not just rough budget estimates. If a statement of reasons for non-attachment is used, it must convincingly explain why cost estimation is difficult. Previously, if the expected cost was less than 1 billion KRW annually on average, a cost estimation report was not required, but from this year onward, both the cost estimation report and the statement of reasons for non-attachment must be submitted without exception.

The regulations on the ‘funding procurement plan,’ which explains where the budget will be sourced from, have also changed. Although the Enforcement Decree of the National Finance Act already required a funding procurement plan when legislating, it did not require specifying the procurement method for each item. From now on, the procurement method must be written for every item requiring funds. Even for the same bill, depending on the content, it must be clearly stated whether the funds will come from tax revenues, accounts or funds, or adjustments to existing budgets.

This revision was made due to concerns that many bills submitted by the government and the National Assembly lacked budget estimates or had poor-quality ones. According to the National Assembly Budget Office, 18,025 bills were submitted during the 21st National Assembly (May 30, 2020 ? November 30, 2022). Of these, only 5,357 bills, or 29.7%, had either a cost estimation report or a statement of reasons for non-attachment. In particular, only 145 out of 573 government-submitted bills (25.3%) included the required documents.

Even among bills subject to cost estimation, many omitted budget calculations. The National Assembly Secretariat pointed out during the regulation revision that “in many cases, government-submitted bills did not include cost estimation reports due to reasons such as the scale of support being undecided,” and “even when reports were prepared, many were poorly written.” This criticism highlights that both the executive and legislative branches have not properly followed regulations established to ensure sound fiscal management and accurate budget execution.

The issue is effectiveness. Unless bills without cost estimation reports are returned to lawmakers or the government, there is little incentive to attach them. A National Assembly Secretariat official emphasized, “(Cost estimation reports, etc.) should be attached to legislative proposals, and if the regulations are not followed, submission will not be accepted.”

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