Ministry of Education Tightens Control on Education Offices Amid Austerity... Penalties Imposed on 'Cash Welfare'

4 Trillion Won Decrease in Local Education Finance Grants
Amendment to the Enforcement Decree for Efficiency in City and Provincial Education Office Spending
"Top 8 in Cash Welfare Face 1 Billion Won Penalty"

The government has announced plans to reduce local education finance grants to cover this year's tax revenue shortfall and is now pressuring metropolitan and provincial education offices to cut costs. They intend to restructure expenditure items by imposing penalties to prevent cash welfare spending.

On the 29th, the Ministry of Education announced that it had deliberated and approved the amendment to the "Enforcement Decree of the Local Education Finance Grants Act" at the Cabinet meeting. Local education finance grants are a system that allocates resources secured through domestic taxes to metropolitan and provincial education offices to ensure that all students receive quality education anywhere in the country. Although the original budget for this year was set at 68.9 trillion won, the government plans to allocate 64.6 trillion won, about 4.3 trillion won less, according to the "Fiscal Response Plan Based on the 2024 Tax Revenue Re-estimation" announced the previous day.

Prime Minister Han Duck-soo is attending and speaking at the Cabinet meeting held on the 19th at the Government Seoul Office in Jongno, Seoul. Photo by Jo Yong-jun jun21@

Through this amendment, the Ministry of Education will push for expenditure efficiency among metropolitan and provincial education offices. First, it will remove inefficient elements of local education finances by reducing cash welfare spending and strengthen accountability by introducing penalty items. The enforcement decree adds a "ratio of self-managed social security benefit expenditures" under the "Support for Efficient Fiscal Execution" section, allowing the government to manage cash welfare expenses independently pursued by education offices. Additionally, education grants will be distributed considering the actual capacity to execute facility projects.

Cho Hun-hee, Director of Local Education Finance at the Ministry of Education, explained, "Penalties will target the top eight offices based on the median level," adding, "The penalty amount will be around 1 billion won." He continued, "Local education finances have long been criticized for being lax and inefficient, so we have taken measures to strengthen accountability and efficiency within the scope of legal and institutional authority," emphasizing, "This is to address the high rates of unused or returned education grants."

[Source: Ministry of Education]

On the other hand, grant support will be expanded for new policy areas. This includes increased funding for Neulbom Schools (approximately 300 billion won), teacher workload and capacity development (530 billion won), establishment of basic academic support systems (350 billion won), subsidies for lifelong education facility costs (86 billion won), and new projects such as AI (artificial intelligence) digital textbooks.

Furthermore, starting next year, a Local Education Finance Grants Committee will be established under the Deputy Minister of Education to incorporate expert and metropolitan/provincial education office opinions in the calculation and distribution of education grants. The revised provisions will be applied from the distribution of general grants next year. Director Cho added, "Specific expenditure ratios and other details will be decided later and communicated again."

However, opposition from metropolitan and provincial education offices is expected regarding the reduction of education grants. The day before, the National Association of Metropolitan and Provincial Superintendents of Education held a press conference at the National Assembly, urging the National Assembly and government to take measures, warning that if the local education tax portion of the tobacco consumption tax expires at the end of this year, a budget gap of about 1.6 trillion won will occur. They claimed, "Media reports suggesting that metropolitan and provincial education offices have budget surpluses do not reflect reality."

Oh Seok-hwan, Deputy Minister of Education, stated, "This amendment is a proactive measure to respond to changes in the education field to ensure that all students receive quality education," adding, "We will continue to strive for rational and efficient distribution and utilization of grants."

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