Mutual Aid Society Unions Oppose Relocation: "Profitability Will Decline Due to Talent Drain, Severed Networks, and Disrupted Information"

"Not a State Institution, But a Voluntary Association of Members"

"Forcing Relocation Infringes on Autonomy and Property Rights"

As the government's second-phase roadmap for the relocation of public institutions to local areas is becoming clearer, labor unions of mutual aid societies have formed a united front to oppose the move. They argue that the government's forced relocation infringes on the autonomy and property rights of private organizations and would undermine the profitability of mutual aid societies due to disruptions in personnel and information. Mutual aid societies are core limited partners (LPs) in the domestic capital market and are responsible for the retirement security of 1.6 million public servants, teachers, soldiers, and police officers.

The "Council of Union Associations for Mutual Aid Societies," which consists of labor unions for teachers, administrative staff, military personnel, and police officers, issued a joint statement on the 11th, stating, "Mutual aid societies are self-help organizations with a private character, operated by voluntary contributions from members—not by state finances. Treating them the same as general public institutions and forcing relocation constitutes a serious infringement on members' property and the autonomy of the organization, and undermines the foundation of institutional competitiveness."

The Council emphasized the unique characteristics of the asset management market, warning that, given the high proportion of alternative investments handled by mutual aid societies, leaving the financial ecosystem that has been accumulated over a long period would lead to irreversible management crises, including reduced access to investment information, loss of key asset managers, and severed global networks.

The Council further stated, "Even during the first phase of relocations in the past, the government recognized the special nature of mutual aid institutions and included an exemption clause. If the government breaks its own legal trust and sacrifices the private property of 1.6 million members for political purposes, we will not hesitate to launch an all-out struggle."

Previously, on March 4, the Council of Union Associations for Mutual Aid Societies sent a "Suggestion to Exclude Mutual Aid Societies from the Second Phase of Public Institution Relocation" to relevant ministries, including the Ministry of Land, Infrastructure and Transport, the Ministry of the Interior and Safety, the Ministry of Education, and the Ministry of National Defense. The intent was to emphasize that mutual aid societies are not public institutions based on state finances, but self-help organizations operated by voluntary contributions from members, and that their unique characteristics, asset management structure, and systemic risks should be comprehensively considered.

Jung Jeonghee, President of the Korea Federation of Public Service and Transport Workers' Unions, the umbrella union for mutual aid society unions, said, "We will strongly respond to the government's relentless push for a second round of relocations without proper assessment or reflection on the first round, utilizing all means, including nationwide joint actions with our 90,000 union members." She added, "The government must stop holding mere 'listening sessions' that exclude real negotiations with workers who are directly affected by the relocation, and unilateral moves without labor-government consultation will only lead to further conflict and the erosion of public interest labor rights."

"Financial Infrastructure and Networks Are Directly Linked to Profitability... This Will Weaken Korea's Financial Competitiveness"

The Federation of Mutual Aid Association Labor Unions issued a joint statement on the 11th, urging the government to exclude them from the second phase of public institution relocations to local areas.

There are also concerns about the potential damage to the financial ecosystem. Yoon Seokgu, President of the Korea Financial Industry Union, said, "For mutual aid societies, which are global investment institutions, advanced financial networks and infrastructure are essential to achieve high returns in the alternative investment market, where information asymmetry is significant. Mutual aid societies compete with leading global private equity funds and asset management companies, so if institutional competitiveness is undermined by relocation, Korea's financial competitiveness in the global market will inevitably weaken as well."

Lee Jaejin, President of the National Union of Office and Financial Service Workers, also commented, "For asset management firms, securities companies, and insurance companies operating in the capital market, mutual aid societies are more than just clients—they are key partners (LPs) who set the direction of the market. If physical distance increases, there will be serious bottlenecks in real-time deal closing and risk management, which will ultimately reduce the work efficiency of all domestic financial workers collaborating with mutual aid societies and lead to a contraction of the market."

The Korean Mutual Aid Association Academic Society stated, "With changes in the global asset management market, even the National Pension Service now prioritizes profitability over public interest. Given that access to financial infrastructure is directly linked to returns for mutual aid societies, if their right to self-governance is damaged, there may be constraints on their fundamental goal of enhancing member welfare. Therefore, a more cautious approach is needed in the government's policy implementation."

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