Unreformed Public Organizations to be Restructured

Beginning this year, the government will embark on a plan to restructure public organizations when state-owned companies and government-affiliated organizations make little progress in their reform efforts.

The government also decided to come up with ways to enhance the competitiveness of public organizations, based on its conclusion that public agencies have been more complacent in carrying out self-assessments than private organizations.

The Ministry of Planning and Budget announced the government’s decisions on May 3 when it presented its plans in a public organization CEO forum on innovation. About 180 people attended the forum, including heads of state-owned companies and government-affiliated organizations, experts from the private sector, and government officials.

The ministry pointed out that public organizations focused on outward restructuring like privatization and failed to bring about any creative innovation. It also said that labor unions resisted innovation, while organization heads fell short of presenting vision because of their ambiguous status as neither public nor private organizations.

As a result, the government will give a task to each public organization and assess how much each has achieved at the end of the year. The organizations with poor performance will be classified as “less innovative” and faced with restructuring measures, such as staff reductions and the integration or elimination of their structures.

The tasks for innovation imposed by the government include improving the operating system of affiliated companies, introducing a collective assessment system, upgrading an assessment system of government-sponsored research institutes, and improving governance.

The government will start to resolve issues regarding complacent management of affiliated companies of public organizations by checking to see if they are serving their original purposes.

legman@donga.com