Local Government in Asia and the Pacific: A Comparative Study

Country paper: Republic of Korea

  Description of the Country
  Evolution of Local Government
  Local Government Categories
  Local Government Functions
  Local Government Finances
  Personnel Systems
  Central-Local Links
  Public Participation
  The Way Ahead

Brief Description of the Country and its National/State Government Structure

Demography

The Republic of Korea is located in the southern part of the Korean Peninsula, which extends southward from the northeastern edge of the Asian continent. Korea is bordered on the north by China and Russia and across the East Sea lies Japan. The land area of the country is about 99,392 square kilometres (38,340 square miles) and its population is around 44 million. Though over 70 per cent of the Korean Peninsula is mountainous, there are also more than 3,400 islands adjacent to the Korean Peninsula. While Koreans belong to the Mongolian race, they have maintained a distinctive language, culture and customs. Korean language is thought to be a member of the Ural-Altaic family, which includes such languages as Mongolian, Finnish and Hungarian. About 85.5 per cent of the Korean population resides in urban areas. Some major cities accommodate a huge portion of the national population. In particular, over 10 million people - about 23 per cent - now live in Seoul. The population of the six largest cities, including Seoul, represents 47.3 per cent of the national population.

Korea has been an independent country with a history of over 5,000 years. At the turn of the twentieth century however, Japan annexed it for 36 years (1910-1945). Shortly after restoring its Independence, a civil war known as the Korean War (1950-1953) broke out between the Peoples Democratic Republic of Korea and the Republic of Korea. Though the war devastated Korea, both the leadership and the Korean people tried hard to develop its economy, recording an average annual GNP growth rate of 8.4 per cent for more than 30 years. As of 1998, Korea is an industrial country with several industries that are very competitive in the world market. Some of them include semiconductor, electronics, shipbuilding, steel and automobiles. But the country is facing a serious economic crisis caused by a Chaebul centred economic structure, dominated by gigantic business groups, and shortage of foreign exchange holdings. From the coup of major general Park Chung Hee in 1961, Korea was ruled by a succession of military dictators until 1987. Since then, Korea has experienced rapid democratization. Today Korea has reached an advanced stage of democracy with freely elected local councils and separation of powers between three branches of national government: the legislative, the executive and the judiciary branch. Korea has a unitary, democratic form of government, republican in nature with a presidential system. The President is directly elected by the people to a single five-year term and has a wide range of power over the central government. He also serves as the Commander in Chief of the Korean armed forces.

The executive branch consists of 2 boards, 14 ministries, 5 offices, 14 administrations and 2 outer bureaus. The legislative branch has one chamber, is called the National Assembly and consists of 299 members of whom 250 are directly elected and the rest are distributed to the parties according to the popular votes earned in an election. The Korean multiparty system has three major parties, but is somewhat unstable because these do not represent different political ideologies or interests in society. Rather, Korean political parties have been under personal influence of Kim Young Sam, Kim Dae Jung and Kim Jong Pil who have had strong bases of regional supports. The judiciary branch has a typical three-level system with a Supreme Court, a Court of Appeals and Trial Courts. There are some special courts including the Court of Constitutionality as well as Juvenile and Family Courts.

Evolution of Local Government, its Legal and Political Background

Korea has a long history of local autonomy characterized by informal, voluntary institutions for the purpose of increasing mutual help among people. Hang-Yak and Kye, for example, were typical cases of voluntary agreements among community members and played very important roles regarding the formation of community ethics and a mutual help system. Both Hang-Yak and Kye had prevailed in the Korean society ever since the Koryo (935-1392) and Chosun Dynasty (1392-1910); the latter is still found in a variety of forms. Despite the existence of such institutions however, there is no doubt that Korea has been a highly centralized country for centuries. During the late period of the Chosun Dynasty and the Japanese Colonial period (1910-1945), the central government, as the only governing body in the nation, exercised absolute power over the country and its population. All the important local administrators were directly or indirectly appointed by the central government and local councils did not exist. Hang-Yak and Kye remained, but largely in the form of community-based, mutual-help organizations. It was not until the restoration of Independence that a modern concept of local autonomy was introduced in Korea.

During the period of the American Military Government (August 1945-August 1948), local autonomy as an institutional underpinning for democracy aroused great interest among the people and the Syngman Rhee administration of the First Republic addressed a constitutional mandate for the establishment of local autonomy. Based upon this constitutional mandate, the Rhee administration enacted the Local Autonomy Law in 1949. The Law provided that local governments consist of local councils and executive bodies and that only the members of the council be elected by direct popular vote, while the chief executive was to be appointed by the central government. However, between 1956 and 1960 the electoral system was changed to allow for the election of the chief executive. In 1960 it was changed again and the appointment system was reintroduced. Although local autonomy in Korea often incurred serious conflicts between the executive body and the council, it matured gradually. In 1961 however, local autonomy was completely dismantled. The Military Revolutionary Committee led by Park Chung Hee suspended local autonomy by issuing the Temporary Measure on Local Autonomy. This temporary measure provided that the Minister of Home Affairs would play the role of the local councils for the upper-level local governments, that the chief executives of the upper-level local governments would play the role of the lower-level local government councils and that the chief executives of both the upper and the lower-level local governments would be appointed by the central government, that is to say the President.

In 1963, the political situation returned to normalcy with the formation of the Third Republic, but local autonomy was not restored. Although the Attached Clause of the Constitution which was amended in 1962 provided that the appropriate time for the restoration of the local council was to be decided by law, the government had no intention to initiate the necessary process for enactment. This policy was followed by the Fourth Republic (1972-1979) as well. Instead, the suspension became formalized by an attached clause of the so-called Yushin (Revitalization) Constitution amended in 1972, which said that the local autonomy should be suspended until the country was reunified. The Chun Doo Hwan administration of the Fifth Republic (1980-1988) took a little different attitude toward the local autonomy. It declared that it would soon reinstate the local councils. The new Constitution which was amended in 1980 also said that the local council should be restored step by step, based on the degree of financial self-sufficiency of local governments. It also said that the specific time table for the restoration of local councils would be decided by the enactment of law. However, once again, towards the end of the Republic the law was yet to be made. The Rho Tae Woo government of the Sixth Republic(1988-1992) also made a public commitment to grant local autonomy. Throughout the period of the presidential campaign, the restoration of the local autonomy was one of the biggest campaign pledges of the then-ruling Democratic Justice Party (Rho's party). In March 1991, the Rho administration finally held an election for lower-level local council members. In June 1991, another election for upper-level local council members was held. But the election for the chief executive of both levels of local governments was again postponed until 1995 under the rhetoric of ensuring a more stable settlement of local autonomy. In June 1995, the Kim Young Sam administration held elections for both local council members and the chief executives, which elected a total of 245 members. This was the genuine beginning of local autonomy in Korea.

Local Government Categories and Hierarchies

Korea has adopted a two-tier local government system. There are sixteen upper-level local governments (seven metropolitan and nine provincial governments) under the central government. There are also 232 lower-level local governments: 91 counties (rural local bodies), 72 cities and 69 urban districts. The upper-level local governments (Kwang-Yuk-Ja-Chi-Dan-Chye) are autonomous local authorities with relatively broad territorial jurisdiction; the lower-level local governments (Ki-Cho-Ja-Chi-Dan-Che) are basic level local authorities.

Figure 1. Hierarchy of Local Government Structure

Local Government Functions

Article 9 of the Local Autonomy Law provides local government with functions that are inherently local in nature and with functions delegated by the central government. The Law also exemplifies six categories of local government functions.

Table 1. Issue Categories and Functions of Local Governments

These are just a few examples, many additional functions can be added to belong to the jurisdiction of local governments. In reality however, this is not the case. Article 9 of the Local Autonomy Law has a conditional clause, which virtually nullifies the above local government functions. The conditional clause reads as follows:"Despite the functions specified in this law, the central government may exercise its own power and control over any function, if other laws define them as the functions of the central government." In other words, the conditional clause provides a virtual carte-blanche to the central government. Currently numerous laws define the above exemplified functions as those of the central government, which has seriously weakened the power and autonomy of local governments.

Executive and legislative

All the local governments in Korea have the governing structure similar to the strong mayor-council system in the US. They have the chief executives (governors, mayors, county executives and district executives) and local councils. Chief executives of both upper and lower-level local governments are elected by direct popular vote for a four-year term. Lower-level council members are also elected by direct popular vote for a four-year term, but the upper-level council members are elected in a little different way. While ten out of eleven are elected by the popular vote, the remaining one is selected through a proportional representation system that was adopted just before the 1995 election. The main purpose of proportional representation is of course to prevent the excessive one party domination in local councils. Political parties can nominate candidates and conduct campaigns for the chief executives and upper-level local council member, but they are not allowed to get involved in the lower-level council elections. Since the executive body and the council are expected check and balance each other, each of them is endowed with proper legal authorities. First of all, the local council has the authority to represent citizens' interests and to oversee local administration. It can initiate a bill with the signatures of either more than ten council members, or one fifth of the total council members. It also has the exclusive authority to pass local ordinances and to decide on important policy issues within the domain of local governments. The first clause of the Article 35 of the Local Autonomy Law exemplifies some of these important issues as follows:

• Enactment, revision and abolishment of ordinances;
   
• Review and approval of budgets;
   
• Review and approval of closing accounts;
   
• Imposition of user fees, service charges and local taxes that are not prescribed either by laws or by executive and ministerial orders;
   
• Establishment and management of funds;
   
• Purchase and disposition of important properties and assets;
   
• Construction and operation of public facilities;
   
• Resigning the non-budgetary rights or obligations that are not prescribed either by laws or by executive and ministerial orders;
   
• Receiving citizens' petition; and
   
• Other issues that are prescribed as the responsibilities of local councils by laws and executive and ministerial orders.
   

The chief executive has the authority to control all the administrative affairs within the jurisdiction of local governments including policy formulation and implementation, personnel and financial management, organizational reengineering and so forth. The chief executive not only deals with the locally autonomous functions which are inherently local in nature, but also takes care of the functions delegated by the central government. Local councils cannot intervene in the delegated functions, which consist of about 50 per cent of the local government functions. In addition, the chief executive has veto power against the decision of the local council.

Table 2. Powersharing between the Chief Executive and Local Council

Local Government Finances

Income structure

The income of the local government can be broken down into two categories:

• Self-generated revenue; and
   
• Grants from central and upper-level local government local government.

Self-generated revenue and central government grants can be broken down into the following three subcategories:

• Categorical grants;
   
• Revenue sharing; and
   
• Shared locally raised taxes.
   

Figure 2. Structure of Local Taxes (1996)

Unit: Korean 0.1 billion Won (880.00 Won = U$1.00, as of 1996)

Source: Data compiled from various documents of the Ministry of Home Affairs

Categorical grants given by the central government or the upper-level local governments to the local government are to be spent on specific programmes. In most cases, the local government is required to contribute its own share in the form of matching-funds to get these grants. Revenue sharing grants provided by the central government are meant to strike a financial balance among local governments. According to a fixed formula provided in the Revenue Sharing Law, the local government with a weaker financial capability gets more, while some with relatively strong financial capability get none. Each year the central government transfers about 13.27 per cent of the total domestic tax revenue for revenue sharing. Shared taxes (major resources stem from taxes on liquor, telephone and excessive-land ownership) are grants provided by the central government for five broad-purpose programmes that may promote both national and local interests:

• Local road construction;
   
• Rural development;
   
• Environmental protection;
   
• Juvenile delinquency; and
   
• Regional development.
   

Structure of local revenue

The overall revenue structure by the categories of governments is summarized as follows.

Table 3. General Account Structure of Local Finance
(in Korean Won)

Unit: Korean 0.1 billion Won (880.00 Won = U$1.00, as of 1996)

Source: Data compiled from various documents of the Ministry of Home Affairs

Central-Local Links

Central government exercises very strong power and influence over local government. Some important powers of the central government are summarized as follows:

Daily operation

The Local Autonomy Law provides that the central government is authorized to intervene in the daily operation of local governments. Article 155 states that central government ministers can advise and guide local government on any administrative matter, regarding both autonomous and delegated functions. If necessary, they can request the executive body of the local government to submit relevant materials and documents to them. Article 158 also says that the Minster of Home Affairs can conduct an audit even on inherently local functions, if it finds the local government violates laws and orders. Article 156 states that upper-level local governments fall under the supervision of the central government, while lower-level local governments fall under the supervision of upper-level local government.

Revocation and suspension of decisions

If the ministers of the central government find that the decisions of the chief executive on delegated functions violate laws and orders of the central government or severely hurt the public interest, they can order the chief executive to correct them in a given period of time. If the chief executive does not follow the order, the minister can revoke or suspend the decision. As mentioned earlier about 50 per cent of the functions that local governments perform are delegated functions. The minister can revoke or suspend local government's decisions on autonomous functions as well. But in this case, the revocation or suspension of local government's decisions can be made only when they violate laws and orders. If the chief executive disagrees with the revocation or suspension of central government, he/she can file a suit in the Supreme Court within 15 days from the revocation or suspension.

Writ of mandamus

If the ministers of the central government find that the upper-level local government neglects its duties on the delegated functions, they can write a writ of mandamus to urge the local government to accomplish the duties in a given period of time. The chief executive of the upper-level local government can also write the writ of mandamus to the lower-level local government. When the local government does not follow the writ of mandamus, the minister of the central government and the chief executive of the upper-level local government can conduct an execution by proxy at the expenses of the local government. If the chief executive of the local government finds the writ of mandamus inappropriate, he/she can file a suit in the Supreme Court within 15 days.

Veto power on the decision of the local council

The Minister of Home Affairs can order a chief executive of the upper-level government to veto the decision of the local council if he/she finds the decision violates laws and orders of the central government, or they hurt the public interest severely. The chief executive who receives the order from the minister is obliged to veto the decision. The chief executive of the upper-level local government can make the same order to the executive of lower-level local government. The local council can override the veto by the vote of a two -third majority with over half of the members present. But in this case, the Minister of Home Affairs can order the chief executive of the local government to file a suit in the Supreme Court within 20 days of the decision. If a chief executive does not follow the order of the minister, the minister himself/herself can file the suit.

Mediation

The Minister of Home Affairs can mediate conflicts among local governments. Article 140 of the Local Autonomy Law states that the Minister of Home Affairs can mediate the conflicts in which an upper-level local government is involved. When the minister undertakes a mediation, he/she has to be advised by a Mediatory Committee on Conflict Among Local Governments and the heads of the appropriate central government agencies. The article endows the same authority to the executive of the upper-level local government for the conflicts among lower-level local governments.

Fiscal control

In addition to the administrative authorities described above, the central government also has strong fiscal control mechanisms. First of all, it exerts strong influence through the distribution of categorical grants and shared taxes. Second, the central government (the Ministry of Home Affairs) can also utilize revenue sharing as a leverage on the local government. Formally there is not much discretion in the distribution of revenue sharing because it is distributed by a fixed formula. But it should be noted that one-eleventh of the revenue sharing is saved for special administrative needs that cannot be forecasted at the time of budget formulation. The Ministry of Home Affairs exercises strong discretionary powers in distributing such special funds because there are no specific and detailed guidelines for their distribution.

Extent of Public Participation

Citizens can participate in local administration through various institutional mechanisms such as a citizen petition, resident voting, resident request for audit and investigation, participation in committees, etc. Besides which citizens can write a petition to the local council.

Citizen petition

Any individual council member can introduce a citizen petition. Since there is no citizen proposition system in Korea, the petition has been utilized as a very effective instrument for such public interest groups as YMCA and CCEJ(Citizens Coalition for Economic Justice) to initiate a local policy agenda.

Resident voting

The Local Autonomy Law states that the chief executive of the local government can refer some serious matters to resident voting. But the resident voting has never been undertaken in practice, because the law which would regulate the process has yet to be enacted.

Resident request for audit and investigation

Some local governments, such as the Seoul Metropolitan Government have enacted ordinances that recognize citizens' right to request for a special audit and investigation of local administration. In most cases the requests are made by public interest groups, rather than by individual citizens.

Participation in committees

Local governments are running a variety of committees in which public or special interest groups can participate. Some important committees such as the Committees on Urban Planning are formed by legal mandate of the central government. But local ordinances or executive rules (orders) of local governments make most of the committees.

Public hearings

Local governments sometimes state a public hearing to hear citizens' views on important policy issues. Some local governments are now planning to enact an administrative Process Ordinance requiring them to make the administrative process more open to the public.

Local government information ordinance

After 1993, a number of local governments enacted the Local Government Information Ordinance which states that local government should provide citizens with administrative information within proper time limits.

Ward committee

There are 460,297 ward committees (bansanghoe) in which people in a small ward (ban) get together once a month and discuss ward matters. Through the bansanghoe, the central and local governments provide the citizens with some administrative information.

The Way Ahead

The Korean central government has revealed a very conservative tendency as far as local autonomy is concerned. It has been reluctant to decentralize administrative functions and to strengthen local governments. As a result, the functions of local governments are still limited to a great extent. While local governments do not have enough authority to enact a penal regulation, the central government is regulating even what type of car (in terms of size) chief executives of local governments are entitled to ride and how much local councils pay for lunch for council members. Such an uneven distribution not only impedes the development of local autonomy, but also hurts the overall competitiveness of the country.

However, the present government of President Kim Dae-Joong is known for its decentralization tendencies. After wining the election he once again clarified his strong commitment to local autonomy and promised to downsize the Ministry of Home Affairs which has been a focus of criticism for excessive control over local government. He has also promised to accelerate the decentralization of administrative functions. These pledges encourage many Koreans to believe that a series of positive changes are forthcoming.