The Ministry of Economy and Finance is expected to announce a reorganization plan for economic ministries this week, which includes separating the budgeting function.
According to political circles and financial authorities on the 10th, the Presidential Committee on Policy Planning will hold a public report meeting on the 13th and announce the government reorganization plan along with national tasks. The reorganization plan is expected to include transferring the budgeting function from the Ministry of Economy and Finance to the Office for Government Policy Coordination and separating the policy and supervisory functions of the Financial Services Commission.
It's the first separation since the integration of the Office for Government Policy Coordination and the Ministry of Finance and Economy in 2008, 17 years ago. The Office for Government Policy Coordination is likely to take on the responsibility for establishing and promoting medium to long-term policy tasks along with budget preparation. This means that some roles of the Ministry of Economy and Finance's Future Strategy Bureau and Economic Structure Reform Bureau may shift to the Office for Government Policy Coordination. There is also a strong proposal to separate public policy functions from the Ministry of Economy and Finance and operate them under a commission system.
A significant reorganization of the Financial Services Commission is also anticipated. The National Policy Committee is reviewing a proposal for the Ministry of Economy and Finance to absorb the domestic financial policies previously overseen by the Financial Services Commission and to integrate the supervisory functions of the Financial Services Commission with the Financial Supervisory Service to form the Financial Supervisory Commission.
However, there is a debate over whether to grant supervisory authority to the Financial Supervisory Service or other private organizations. Similar discussions occurred in 2017, but at that time, the Ministry of Government Legislation interpreted that sanctions against financial institutions and permits must be carried out directly by administrative agencies, suggesting that transferring them to private bodies could be unconstitutional.
If the reorganization of the economic ministries is confirmed as is, the roles of the Ministry of Economy and Finance and the Financial Services Commission will be significantly reduced. The main functions remaining at the Ministry of Economy and Finance will include taxation, policy, finance, and treasury, and the name of the ministry is expected to change to the Ministry of Finance and Economy. The Financial Services Commission will effectively undergo a process of dismantling.
Additionally, a proposal to separate the Consumer Protection Department from the Financial Supervisory Service and elevate it to the Financial Consumer Protection Agency is under discussion. In relation to this, the FSS union released a statement on the 7th, arguing that the Consumer Protection Department should be an independent organization within the FSS while simultaneously elevating the status of the head of the Consumer Protection Department to equal that of the head of the FSS and ensuring independent operations of its budget and personnel.