A delegation from the four major councils of local governments issued a joint statement on the 30th calling for mandatory prior consultation with local governments for policies that entail a burden on local government finance, such as "consumption coupons." The four major councils of local governments consist of ▲ the Council of Governors of Korea ▲ the Council of Chairs of Provincial and Metropolitan Councils of Korea ▲ the Council of Mayors, County Chiefs, and District Heads of Korea ▲ the Council of Chairs of City, County, and Autonomous District Councils of Korea.
Marking the 30th anniversary of the implementation of local autonomy on this day, the delegation criticized at the meeting that "major policies such as consumption coupons and the basic income pilot project for rural and fishing communities have been pushed forward without prior consultation with local governments, while placing a heavy burden on local government finance."
They added, "Although the current Local Finance Act and other laws stipulate consultation with the Minister of the Interior and Safety, the practical procedures are inadequate," noting, "The obligation to consult local governments should be strengthened, and if this is not carried out, the fiscal responsibility of central ministries should be clarified."
Earlier, the government ordered that funding for the second round of "consumption coupons" be prepared with 90% from the national budget and 10% from local budgets (25% for Seoul). With the policy handed down without sufficient prior consultation, some local governments with insufficient finances faced a crisis of having to consider issuing local government bonds. In addition, under the Local Finance Act at the time, issuing local government bonds for the purpose of paying out consumption coupons was impossible, causing confusion. The legal amendment to allow this was made only on the 26th.
Incheon Mayor Yoo Jeong-bok, who chairs the Council of Governors, said, "When the government told us to shoulder the local budget share for the coupon program, it recommended issuing local government bonds, but there was no legal basis, so we had no choice but to use the disaster relief fund," adding, "The legal amendment came after the fact. Any project that imposes a burden on local governments should be consulted in advance and proceed with a legal basis in place."
The delegation also called for the establishment of "fiscal decentralization." The delegation said, "The ratio of national to local taxes remains 75 to 25, entrenching a national tax-centered fiscal structure," and added, "We need to improve the reality in which local autonomy is constrained by the expansion of centrally led subsidy projects and the operation of competition-based projects." They continued, "Local governments should be able to independently formulate and execute policies and projects suited to regional characteristics," and noted, "A balanced cooperative system in which the central and local governments share fiscal authority and responsibility should be established."
On this point, Cho Jae-gu, chair of the Council of Mayors, County Chiefs, and District Heads of Korea (Nam District Chief of Daegu), said, "The statutory grant rate for the ordinary local allocation tax should be raised from the current 19.24% to 24.24%," adding, "Expanding the ordinary local allocation tax and granting it directly to autonomous districts is a matter directly tied to the survival of basic local governments."
There were also calls for a decentralization-oriented constitutional revision. The delegation said, "The preamble to the Constitution should codify the basic principle of state governance that 'the Republic of Korea pursues local decentralization,'" and added, "Local autonomy should be positioned not as a mere administrative system but as a key pillar for realizing popular sovereignty and achieving balanced national development." They went on to say, "The central and local governments should establish an equal relationship based on constitutional values, grounded in mutual respect and cooperation."