The National Planning and Advisory Committee, which takes on the role of the transition committee for the Lee Jae-myung government, set sail on the 16th. Three reform-minded individuals, who have been floated as candidates for the head of the Financial Supervisory Service, will participate in the Economic Division 1, which is responsible for financial policy. They are expected to take on the blueprint for restructuring the financial authorities under the catchphrase "separation of policy and supervision."
The government held the launch ceremony for the National Planning and Advisory Committee at the Seoul Government Complex in the morning and announced the committee's roster. The organization responsible for financial policy is Division 1 of the Economic Division, chaired by Jeong Tae-ho of the Democratic Party of Korea. Five commissioners, including Oh Gi-hyeong, Hong Seong-guk, Kim Byeong-wook, Professor Kim Eun-kyung of Hankuk University of Foreign Studies, and Professor Lee Jong-wook, a former professor at Seoul National University of Science and Technology, are participating in the division.
A notable point is that individuals with a financial reform background have been positioned in Economic Division 1. Among the division's commissioners, three are experts in finance: Hong, the Supreme Council member, Kim, the former lawmaker, and Professor Kim. It is reported within the ruling party that these three will lead the design of financial policies within the division. Especially, since they have actively advocated for consumer protection in finance in the past, they are expected to take the lead in formulating a roadmap for restructuring financial authorities in line with the current government's direction.
The current administration and ruling party believe there is a need to separate policy from supervision. This is a proposal to separate the organizations performing financial policy from those supervising. Financial policy generally focuses on industrial promotion. Currently, a single organization performs both industrial promotion and regulation. There have been consistent criticisms that this structure creates conflicts in operations. Particularly, whenever large-scale consumer protection issues arise, arguments for the necessity of separating policy and supervision have been repeatedly made by the Democratic Party and certain academic circles. President Lee Jae-myung also expressed concern during his campaign last May, stating, "I think the Financial Services Commission should separate and streamline its supervisory and policy functions."
Additionally, there is a consensus within the ruling party regarding the proposal to split the Financial Supervisory Service into two entities. The idea is to transfer the supervisory functions of the Financial Services Commission to the Financial Supervisory Service while dividing it into two institutions. Currently, the establishment of separate bodies for supervising the soundness of financial institutions and for consumer protection is being strongly discussed. Professor Kim, who joined the National Planning and Advisory Committee, has also long been an advocate for dividing the Financial Supervisory Service into two. He recently stated to reporters, "The National Planning and Advisory Committee will discuss the reform of financial authorities," and firmly remarked, "Reforming the Financial Supervisory Service is my destiny."
There is a sense within the financial sector that "this time is different." Although discussions about restructuring financial authorities have been raised since the 2010s, serious efforts have repeatedly failed to materialize due to comparatively low political interest. However, this time, the National Planning and Advisory Committee is expected to address the restructuring of financial authorities as an urgent issue, and the ruling party, which has formed a consensus on this matter, holds the majority.
A person with a senior position in the financial authorities remarked, "If the presidential office and ruling party are determined, there will be no major obstacles to changing the structure of the financial authorities." Another former senior official of the financial authorities noted, "There might be some confusion during the process of changing the organization, but the direction of the Democratic Party is not entirely outlandish," adding, "It is important to create feasible details according to the goals of the organizational restructuring."