[Anchor]
The government has announced a massive reform plan to cut 109 public agencies, accounting for 20 percent of all public institutions. Five power generation companies and four port authorities will be merged into single entities, while the Korea Land and Housing Corporation (LH) will be split into two. The goal is to reduce inefficiency and boost competitiveness, but labor unions are pushing back, calling it a closed-door reorganization carried out without consultation.
Reporting next is Baegun.
[Reporter]
The government announced plans to integrate the five power generation companies—which were split from the Korea Electric Power Corporation in 2001—into a tentative entity named Korea Power Generation after 25 years.
Privatization, the original goal of the split, fell through long ago. The government judged that overlapping investments in research and development and renewable energy projects have instead caused inefficiencies.
[Huh Jang / Vice Minister of Economy and Finance: Integrating the five power companies into one will allow us to achieve a renewable energy-centered energy transition.]
Similarly, the four port authorities scattered across Busan, Incheon, Ulsan, and Yeosu-Gwangyang will be combined into a tentative Korea Port Authority, while the Korea National Oil Corporation and Korea Gas Corporation will be merged into a tentative Energy Resource Corporation.
The plan aims to scale up organizations to enhance their capacity to respond to supply chain crises and improve external negotiation power.
Meanwhile, LH will be divided into two separate agencies.
Land development and housing construction will be handled by the Housing and Urban Development Corporation, while residential welfare, including rental housing operations, will be managed by the Housing and Urban Asset Corporation.
The government explained that housing supply was delayed and the burden of operating rental housing grew because the development division, where speed and financial performance are critical, and the residential welfare function, which emphasizes public interest, were housed under one roof.
This public sector reform will reduce a total of 109 institutions.
Labor unions criticized that the reorganization has been pushed forward without sufficient review and public debate, excluding workers and users.
[Kang Sung-gyu / Vice President of the Korean Public Service and Transport Workers' Union under the Korean Confederation of Trade Unions: This is a plan hatched behind closed doors and passed by rubber-stamp methods, announced as a government reform. They must admit that there was no sufficient labor-government consultation or social discussion.]
The government stated that it will guarantee job succession for employees and ensure their compensation does not drop. However, because some consolidations and mergers require revisions to relevant laws and labor-government talks remain, considerable friction is expected.
(Video by Cho Choon-dong and Kim Heung-ki | Video Editing by Kim Jong-mi | Design by Hwang Se-yeon)
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