The purpose of the public sector

Public institutions are awash with new, novel responsibilities. The liberal Moon Jae-in administration commands them to add more value to society. They are asked to convert irregular workers to permanent status, pay more attention to those on the margins of society, root out unfair hiring practices and contribute to regional development.

They are all necessary tasks, but they are not related to their primary functions. Public institutions are not designed to generate jobs and contribute to regional communities. They must find ways to be more useful to society through their main purpose.

Social value refers to services such as community development. The purpose of the state in the past was economic advancement. Today, issues like community development, environmentalism and human rights are of greater importance.

Korea scored last in the community, environment and work-life balance category in the 2016 Better Life Index of the Organization for Economic Cooperation and Development. The survey measures the well-being and quality of living conditions in developed economies. Korea’s goals today focus on improving the quality of individual lives over quantitative national growth. So how can public institutions contribute to the goal?

Weak communal ties stem from inequalities in housing conditions. Korea Land & Housing (LH) should make sure public housing goes to low-income people. The tenants at LH-built public buildings are mostly middle class, falling around a 4.5 on the 10-level income category. For LH, it is financially safer to rent homes to middle-income households. There are many expensive foreign cars parked at public apartments that were originally designed to house poor people. LH must not rent out cheap homes to people who can afford to buy luxury cars. That is a start in improving inequalities in housing.

One of the biggest concerns among Koreans these days is the horrid air conditions due to fine dust. The primary culprit is vehicles on the roads. It makes one wonder how they are allowed to spew such toxic particles.

Authorities say they carry out regular checks to prevent slack emissions inspection, but it is hard to believe once you see the heavy pollution on the roads. The Ministry of Land, Infrastructure and Transport plans to incrementally transfer private-sector authority to inspect buses to the Korea Transportation Safety Authority. But according to the Korea Institute of Environmental Research’s 2013 findings, 92 percent of fine dust particles on the road came from trucks and diesel-powered cars. Buses accounted for a paltry portion of the pollutants. All emissions inspections should be done by the state.

Private inspectors might put up a fight, as they would lose a big revenue source. The state transportation authority should, in response, yield its authority over safety inspections. Private inspection centers must ensure they do the job perfectly.

Drivers prefer inspectors to go light on gas emission tests, but they cannot compromise safety. Private businesses cannot dare to be negligent if their job involves safety. The state, therefore, does not necessarily have to be responsible for safety checkups. It must concentrate on vehicle emission control instead.
What about the empty train stations in small rural towns? To ensure transportation rights for residents in remote regions, the stations must stay, especially if there are no other transportation options. But if buses are running, it would be better to increase the number of buses by offering subsidies to bus operators.

It is costly to sustain a train station in remote rural areas. According to the report to the National Assembly in 2013, a station in Gangwon, carried one passenger a day on average and generated revenue of 1 million won ($940) a year. The station had 10 staff members and their payroll was 670 million won a year.

It would be more beneficial to the society if tax money was spent to subsidize better bus service in rural areas and close down money-losing stations. Our society will benefit if the Korea Railway Authority can save more money and afford to lower KTX fares.
Many public enterprises branch out to other businesses to expand their organizations. But they must exit other for-profit businesses and concentrate on their primary public function. That is the best way to provide true social value.

Translation by the Korea JoongAng Daily staff.

JoongAng Ilbo, March 29, Page B9

The author is a professor of the Korea Development Institute School of Public Policy and Management.

Park Jin