Transcript Title

Organizing Government for
an Effective PSD Strategy
- A Case of Regulatory Reform
in Korea
Presentation by
Prof. Jong Seok Kim
Professor of Economics, Hong Ik University &
Member of Korean Regulatory Reform Committee
19 April 2005
Key Messages
• Keys to effective PSD strategies:
• Strong government leadership
• Good coordination
• Clear accountability
• An effective institutional PSD mechanism should:
• Coordinate strategies ACROSS ministries
• Coordinate strategies between LEVELS of government
• Provide continuity in the face of political change
The Regulatory Challenge
in Korea - Before 1997
• Korean economy had become heavily
regulated during its rapid growth
• Drive for reform out of popular demand from
business since the early 1980s
• Early attempts at reform were insufficient
• 1997 financial crisis created new impetus
The Challenge of Leadership
• Establish clear rules and structure
• The Basic Act on Administrative Regulation, 1997
• Hold government accountable
• Require regulatory impact analysis (RIA)
• Register all existing regulations
• Centralize coordination
• Presidential Regulatory Reform Committee (RRC),
formed in 1998
The Presidential Regulatory
Reform Committee
• Reporting to the President
• Co-chaired by the Prime Minister and a private
sector co-chair
• Consists of 20 members
• 7 cabinet ministers
• 13 from the private sector, appointed on a 2-year
term
• Has a secretariat in the Prime Minister’s
office
Initial Results
• President ordered 50% of 11,125 existing
regulations eliminated
• Each ministry had to prove the need for its
regulations before RRC during the process
• Within 2 years: 43% of regulations eliminated
and 22% revised
• Virtually all areas of Korean economy and life
were affected
Coordination Across Ministries
• Basic policy guidelines established across the
government
• Quality control and reform guidelines, e.g. RIA
• Each ministry must propose new regulations
and improvements through RRC
• RRC pursues all ministries and agencies for
compliance
Providing Continuity
• RRC functions became a normal part of
government
• Integrated into all government institutions
through administrative processes
• Combination of stakeholder and cabinet
appointees, on separate term cycles
• Independent and publicly accountable
Results - After Six Years
• Permanent system for regulatory reform
firmly installed
• Regulatory design not an exclusive function of
regulating ministries any longer
• Initial reform drive lost momentum as political
support waned
• Coordination between RRC and the provincial
governments was insufficient
• Quality of RIA is still low
Lessons Learned
• Independence and political support essential
to credible role of coordinating the reform
• Accountability links to ministries and local
government needed to enforce change
• Implementation requires plenty of expert
support, at several levels of government
• Make changes visible at local government
level to keep up momentum
Conclusion
• Keep political leadership visible and strong
• Make the policy and its coordinating agency a
permanent part of government
• Maintain consistent reform principles across
the government
• Build coalition for the reform within society
For More Information
Prof. Jong Seok Kim
Email: [email protected]
RETA website:
http://www.adb.org/Projects/Supporting-PSD-Strategies