Urgent public sector reforms

The ruling Grand National Party and the Federation of Korean Trade Unions last week reached what seems to be a dubious and strange agreement to “restructure” state-run corporations by stretching the retirement age and assuring that the government would not interfere in labor-management negotiations.

The agreement, as a part of a policy coordination trial between the ruling party and union groups, aims to overhaul state-run corporations in name but backpedals on details.

The government has been streamlining publicly funded and government-affiliated organizations and corporations to make them more competitive and productive. In part, this is to fulfill the president’s promise to reform the public sector.

It is difficult to understand why the ruling party would go against the government’s drive and instead seek to stretch the retirement age in state-run companies to the same level as civil servants, which in fact translates into increased staff and payments.

Such a benefit would seem unfair to the private sector, which has been expediting downsizing and restructuring in response to the economic slowdown.

The ruling party’s guarantee of independence in labor-management negotiations is also unwarranted. The latest study by the finance ministry certified that unionists at companies that receive investments from the state frequently interfere with management and appointment decisions by threats of strikes and walkouts.

The assurance of independence can be misused by unionists to keep the government out of any labor-management negotiations no matter how unreasonable they may be.

Thus, the task of restructuring the public sector cannot afford to be delayed.

The public sector is eating away at the competitiveness of our economy. It breeds and feeds corruption and inefficiency. Polls show seven out of 10 people believe that the restructuring of the public sector must be implemented at any cost.

There should be no turning back for the government in its reform drive. It must stick to its guns and aim for streamlining, merging and privatizing the public sector.

The GNP must not forget its place. It is understandable that the federation speaks for the interest of unionists. But there is no excuse for the ruling party to splash cold water on the president’s reform drive and run against the public demand.

The political and labor leaders may have tried a populist stunt ahead of the elections season. But no voters will tolerate a turnabout in the reform initiative.