New development: Fiscal reform in South Korea: looking back and moving forward

ABSTRACT

At first glance, it seems that South Korea’s three fiscal systems (mid-term expenditure framework, top-down budgeting, and performance management) function well. However, each fiscal system operates separately and they are inefficient because they follow past practices. This article explains what the problems are and how to overcome them.

KEYWORDS:

• Mid-term expenditure framework
• performance management
• sustainable fiscal operations
• top-down budget

Notes on contributors

Seong-ho Jeong is a Research Fellow at the Korea Public Finance Information Service in South Korea.

Sung Hoon Kang is an Assistant Professor at Hanyang University, South Korea.

Notes

1. The Lee Myung-Bak government weakened the function of MTEF. An example is the highly political ‘four major rivers restoration project’. Recently, this project has been criticized for causing significant budget waste.