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Provinces to Earn Rewards for Containing Utility Fees

Posted February. 06, 2008 03:09,   


The central government will offer financial rewards for provinces and small administrative units if they keep down public utility charges, including utility fees and public transportation fares.

State authorities will also monitor private education and college tuition, prices of school uniforms, and speculation in the real estate market. The National Tax Service will reportedly launch audits on suspected land speculators.

Vice Finance Minister Kim Seok-dong yesterday presided over the second meeting of a ministry task force on public utilities at the Gwacheon Government Complex just south of Seoul.

Task force members predicted inflation will remain in the mid-three-percent range due to rising oil and grain prices and recovering domestic demand."

Under the new incentives, provincial governments can receive monetary rewards if they keep steady public utility charges such as those for tap water and sewage and transportation fares. The type of charge will also be prioritized for the assessment.

The central government will examine rules and ordinances in the provinces that could prevent fair competition in the market. For example, certain regions now require a bidder for a contract to be an incorporated entity in the area in question, or do not allow refunds on commissions.

If a certain region shows early signs of instability in the real estate market, the central government will use regulations to intervene. Furthermore, Seoul will probe those alleged to have committed real estate speculation.

Authorities will also inspect branches of commercial banks in the Seoul metropolitan area to see if they follow regulations, such as meeting the debt-to-income ratio.