The Ministry of Economy and Finance, which serves as the government's economic policy control tower, will be restructured into the Ministry of Finance and Economy and the Office for Budget and Planning. The domestic financial functions of the Financial Services Commission will be transferred to the Ministry of Finance and Economy.
The Ministry of Finance and Economy will carry out functions related to the overall economic policy, tax system, finance, national treasury, and management of public institutions. The newly established Office for Budget and Planning will be under the Prime Minister's authority and will be responsible for budget preparation and establishment of fiscal policy.
The government and ruling party confirmed the proposed government reorganization plan in a high-level party-government meeting on the 7th, as noted by Minister Yoo Ho-jung of the Ministry of the Interior and Safety during the briefing on the meeting's results.
The separation of the Ministry of Economy and Finance was one of President Lee Jae-myung's election promises. The aim was to separate the ministry's functions to reduce the oversized economic departments and enhance their mutual checks.
However, as the new government's transitional committee, which is the Presidential Committee on Policy Planning, did not present concrete proposals until the end of its term, there were discussions that the separation of the Ministry of Economy and Finance might be effectively scrapped. Then, on that day, the high-level party-government meeting confirmed the reorganization plan for the Ministry of Economy and Finance. The ruling party and government set the target date for the ministry's restructuring to January 2 of next year.
The main framework of the reorganization of the Ministry of Economy and Finance is to separate it into the Ministry of Finance and Economy, which oversees economic policy and the tax system, and the Office for Budget and Planning, which is responsible for the budget.
The government explained the background for establishing the Office for Budget and Planning as being aimed at "harmonious budget preparation and allocation, and strengthening mutual checks." In order to fulfill this role, the head of the Office for Budget and Planning will be appointed as a "Minister" instead of "Director." The Minister of the Office for Budget and Planning will also serve as a government council member.
Since the chair of the Fair Trade Commission and the Minister of the Office for Government Policy Coordination, both of ministerial rank, are not appointed as government council members, they do not have the authority to deliberate and decide in the cabinet meeting. This is interpreted as a move to clearly define the roles and powers of the Minister of the Office for Budget and Planning.
The Ministry of Finance and Economy will perform functions related to the overall coordination of economic policy, along with managing the tax system, national treasury, finance, and public institutions. The current position of the Deputy Prime Minister for Economic Affairs, held by the Minister of Economy and Finance, will be concurrently held by the Minister of Finance and Economy. While the budget function will be separated from the Ministry of Economy and Finance, the role as the control tower for the economic ministry will be maintained.
The Public Institution Operating Committee, which had considered transferring to the Office of the Prime Minister, will be retained as an affiliated organization of the Ministry of Finance and Economy. A government official explained that the purpose is to expand the existing Public Policy Bureau to enhance its independence and expertise.
In addition, the domestic financial functions of the Financial Services Commission will be transferred to the Ministry of Finance and Economy.
A government official noted, "To enhance the consistency of domestic and international financial policies and respond to financial crises, we aim to transfer the domestic financial functions of the Financial Services Commission, including the Financial Intelligence Unit, to the Ministry of Finance and Economy," adding that "the financial supervision functions of the Financial Services Commission will be reorganized into the 'Financial Supervisory Commission.'"
Under the Financial Supervisory Commission, the Securities and Futures Commission and the Financial Consumer Protection Agency will be established. The Financial Consumer Protection Agency, newly created and separated from the Financial Supervisory Service, is expected to be designated as a public institution.
The reorganization of the Ministry of Economy and Finance is expected to be implemented on January 2 of next year. Minister Yoo Ho-jung said, "Considering the schedule of the National Assembly's review of the budget for next year, we plan to implement the reorganization of the Office for Budget and Planning, the Ministry of Finance and Economy, and the Financial Supervisory Commission from January 2, 2026," and added, "We ask the National Assembly and the public for their continued interest and support so that a working system for the government can be established as soon as possible."