Saving Budget More Thoroughly... Raising Financial Project Target Rate, 'Restructuring' if Underperformed for 2 Consecutive Years

2025 Fiscal Project Performance Management Plan
Increase Fiscal Project Performance Target Rate from 75% to 80%

The government has raised the performance target rate to improve budget efficiency. If the target is significantly unmet or not achieved consecutively, it will be judged as ‘low performance’ and spending will be tightened.

On the 24th, the Ministry of Economy and Finance reported the ‘2025 Fiscal Project Performance Management Promotion Plan’ containing these details at the Cabinet meeting. This plan includes raising the performance target rate of fiscal projects to an average of 80% over the past five years. Currently, it is around 75%. If the target is 70% or below, or if the performance target is not met for two consecutive years, measures to improve performance such as spending efficiency must be prepared. Programs with insufficient performance management will also be reported to the Cabinet meeting.

Among fiscal policies, core projects will expand ‘multi-ministerial collaborative project performance management.’ This year, the government selected one important project to manage the collaborative performance among several ministries. Next year, five projects will be selected from the 16 collaborative budgets for separate performance management. Performance management plans will be created, implemented, and reviewed centered on the lead ministry of the collaborative budget, and measures to improve performance will also be established. Existing projects will be managed through monitoring, considering that they are progressing normally.

Performance evaluation of fiscal projects will strengthen follow-up management to ensure that evaluation results are well reflected in projects or budgets. For projects that received poor ratings in self-evaluation, the adequacy of the performance management improvement plan will be additionally checked, and the results will be reported to the Fiscal Project Evaluation Committee.

The extension evaluation of subsidy projects will be completely reorganized for efficiency. Currently, evaluation is done by simply summing indicator scores, but going forward, key items related to project feasibility will be evaluated step-by-step. Also, submitted materials and evaluation reports will be greatly simplified focusing on key items with high usability to reduce the burden on each ministry.

In addition, the selection method for in-depth evaluation of fiscal projects will be diversified, and the fund retention evaluation will be simplified.

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