[2017 Study Report on Presidential Success Factors] Cooperative Governance between the Executive and Legislative Branches: Focusing on Budget Determination

Abstract

The recent societal aspiration for political reform calls for a reconsideration of various institutional aspects that were marginalized in favor of direct election constitutional amendments. In particular, institutional reforms regulating the powers and responsibilities of the executive and legislative branches are urgently needed. This is because, despite the presidential system, the expected mutual checks and balances between the legislature and the executive, in accordance with the separation of powers, have been difficult to observe. The issue is that the parliamentary elements in the operation of the Korean government were not adopted out of necessity for efficient government operation. To resolve these problems, institutional reforms are required to foster close cooperative governance between the executive and legislative branches. Specifically, focusing on the budget determination process, the National Assembly must not only participate substantially in the budget formulation process by the executive branch but also be granted the authority to effectively deliberate on the formulated budget. To address these issues, institutional reforms are needed to allow the National Assembly to actively intervene in the budget formulation process, and an information environment must be established for substantial deliberation on the formulated budget. To this end, it is necessary to first examine the characteristics of South Korea's budget determination process. In South Korea's budget determination process, the executive branch holds excessive power, while the legislative branch has weak functions for checking and controlling the executive branch, and simultaneously bears excessive responsibility for legislation. By comparing the budget determination processes of the United States and the United Kingdom, which represent the presidential and parliamentary systems respectively, with the Korean case, the imbalance of responsibilities and powers held by the Korean National Assembly and the executive branch will be pointed out. Finally, this report concludes by presenting several principled and institutional recommendations to resolve these issues.

Main Text

“South Korea's budget proposal formulation and deliberation process demonstrates a budget determination process that is independent between the executive and legislative branches, with almost no cooperative governance or communication. Furthermore, the National Assembly not only cannot participate in budget formulation but, as will be detailed below, does not have sufficient authority to substantially amend the budget proposal during the deliberation process. Consequently, this leads to the problems of inefficient resource allocation and an unequal distribution of responsibility and authority in budget determination between the executive and legislative branches.”

“South Korea's budget determination process shows that the executive branch holds excessive power while tending to be exempt from responsibility for budget failures. In contrast, the National Assembly bears excessive responsibility for budget failures while having weak authority in budget formulation. However, are these institutional characteristics being fully reflected in the actual budget determination process? Is the National Assembly checking the executive branch or exerting substantial influence on the amendment process of budget proposals through close cooperation with the executive branch during the budget formulation process? This section aims to demonstrate the phenomenon of unequal distribution of responsibility and authority in budget determination, focusing on concrete and empirical data.”

“The South Korean National Assembly bears excessive responsibility and weak authority in the budget determination process. Conversely, in a situation where the outdated, government-led budget formulation method is being perpetuated, the executive branch's budget formulation authority is not being controlled or checked at all. These problems are observed not only in institutional aspects but also throughout the entire operational process. As a result, the National Assembly, the representative body directly elected by the people, has degenerated into an institution with low voter confidence, and the executive branch continues to prepare budget proposals without close cooperation with the National Assembly.”

“It is inevitable that the next president must address the imbalance of responsibility and authority between the executive and legislative branches concerning budget determination. Furthermore, discussions on the direction of improvement should be based on a national consensus regarding the future direction, principles, and norms of South Korean society's institutions.”

“For the effective operation of policy consultations between the ruling party and the government in budget determination, two aspects need to be considered. First, the composition of the policy consultation body should be revised to include not only ruling party members but also opposition party members. This is a measure to re-establish the policy consultation body as an organization that successfully coordinates cooperative governance between the legislative and executive branches, moving beyond its past history where it was established to mobilize the ruling party for the executive branch's policy implementation and concentrate government power. If operated in this manner, the policy consultation body, where opinions can be coordinated between the legislative and executive branches, as well as between the ruling and opposition parties, from the budget formulation stage, is expected to maximize the efficiency of budget determination when operated successfully. Second, the policy consultation body should be institutionalized as a communication channel for policy consultations and operated frequently, rather than being limited to a certain frequency of meetings. The current principle of meeting once a month is considered the minimum condition for cooperative governance between the legislative and executive branches. However, rather than formal provisions stipulating this principle, consideration should be given to defining the participants clearly to ensure the actual operation of policy consultations and ensuring that these participants are available for contact at all times.”

“It is necessary to strengthen the functions of the National Assembly Budget Office concerning budget determination. In particular, budget proposals are based on forecasts of key economic indicators and estimates of revenue. It is necessary to develop a National Assembly support system capable of interpreting these key indicators and deriving forecasts. Only when a National Assembly Budget Office with such independent capabilities is established will it be possible to conduct preliminary reviews of the budget proposal submitted by the government and compare and review it with the actual submitted proposal.”

“Considering the comprehensiveness of budget proposals, it is necessary to separate the Special Committee on Budget and Accounts and establish each committee as a standing committee. Changes in domestic and foreign conditions, such as unification, and the continuous increase in welfare budgets are expected to lead to a sustained increase in fiscal demand. Consequently, not only will the size of the budget that the National Assembly must deliberate increase, but complex and technical issues related to budget execution are also likely to arise in the future. These future projections imply that the National Assembly's functions regarding budget and settlement must be further strengthened.”

Author

Han, Jeong-hoonProfessor, Graduate School of International Studies, Seoul National University. Received a Ph.D. from the University of Rochester. His major works include “The Ideological Orientation of Korean Voters: A Case Study on the Effect of Perceptions of the Need for Unification,” “Determinants of Party Support in European Parliament Elections and Pan-European Factors: A Case Study of the UK,” and “Party Politics and the Power to Report: Informational Efficiency in Bicameralism.”