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[EDITORIALS]Budget inefficiencies

Published: 18 Aug. 2004, 22:23

The National Assembly Budget Office has said that the supplementary budgets for last year failed to fulfill their functions. In principle, an additional budget should be requested only when it is urgently needed due to unexpected causes, with the original budget already having been drawn up and spent. So the government should be more careful in drawing up a supplementary budget and should be more efficient in spending it. But according to the budget office, it is even doubtful that the additional budgets approved last year were necessary. And the budgets were not effective, the office said.
A supplementary budget of 3 trillion won ($2.6 billion) was approved in September 2003 to fund restoration activities after a typhoon battered the southern part of the nation. But, according to the budget office’s investigation, only 598.5 billion won, or 16 percent of the estimated 3.7 trillion won cost of rebuilding, was spent on rebuilding projects by the end of last year. That means that the government did not have to propose an additional budget and that it would have been possible for the government to fund most of the estimated restoration costs from the principal budget for this year. The related authorities, including the Ministry of Planning and Budget, should thoroughly investigate why the funds for rebuilding projects were not spent in time and should reveal the investigation results to the public.
When it prepared a supplementary budget for rehabilitation of flood damage last year, the government put the whole amount of 3 trillion won in a reserve fund for coping with natural disasters. The Assembly approved the plan to use the whole amount as reserve funds because the legislature was of the opinion that it was urgent to finance recovery activities after the typhoon. The Assembly intended to save time needed in finding out details of the flood damage.
It is strange that the government spent less than 600 billion won on typhoon recovery despite the urgency of the request for 3 trillion won. It is evidence that the government prepared budget plans out of expediency and implemented the plan inefficiently.
The budget office also said that the Ministry of National Defense and some others used money from the reserve fund without legal grounds. The government should explain how that happened and what it is doing to make sure that the problem does not recur.