2019 Local Finances of the Republic of Korea
Published on 19 August 2019
Published by Administrative Budget Analysis Division of the Budget Analysis Department
The purpose of this report is to enhance parliamentarians‘, parliamentarian assistants’ and the general public’s understanding of local finances, in consideration of the importance of local finances.
This report is composed of three parts. Part I: Introduction to Local Finances highlights their current status including the volume of integrated local finances and major fiscal indicators including those on the integrated independence rate of local finances, along with explanatory notes on each indicator. In addition, the details on fiscal decentralization have been reinforced compared to the 2018 report, by incorporating the government’s Measures to Pursue Local Fiscal Decentralization (announced on October 30th, 2018 collectively by relevant government Ministries) which was released after the publication of the 2018 Local Finances of the Republic of Korea, as well as relevant follow-up measures.
Part II: Developing Local Finances contains the laws and operation principles of local finances as well as the process of local finance budget formulation, budget execution and settlement of accounts, along with an explanation on the local finance management system for enhancing soundness. Furthermore, this report included details of local debt within the supplementary commentaries, adding information on the current status of local debts and local bond issuance procedures.
Part III: Helping Local Finances features the coordination system between the central and local governments which consists of subsidies, education financial grants and national treasury subsidies; as well as the local finance coordination system between local governments which consists of city and provincial subsidies, coordinated grants, and local government funds transferred to offices of education.
In addition, A Bird’s-Eye View of Local Finances has been newly included to enable a panoramic view of how major local finance-related laws and systems have evolved over time.