|2015 S.M.O.E Budget Draft|
S.M.O.E drafts 2015 Budget Plan
• only 3 months of preschool aid issued, demand natl. govt. for solution
• restructure expenditures to recover from financial crisis
• costs for early retirement compensation, school environment improvement, new school construction covered by local educ. govt.
Seoul Metropolitan Office of Education (Superintendent Cho Hiyeon) drafted the 2015 Budget (Plan) amounting to 7.6901 trillion won and introduced it to the City Council of Seoul on November 10th, Monday.
This budget plan was drafted to focus on capturing the lacking financial resources because it was designed to effectively respond to the serious financial problem encountered in light of the fall in subsidy and tax revenue due to the poor economic climate and the rise in personnel expense and uncontrollable expenditures.
One can see that in continuance of the situation in 2014, there is a serious lack of financial resources as the actual budget of 2015, exempting the issued local government bonds, has fallen by 4% compared to that of last year.
We have submitted a 2014 supplementary budget plan to the City Council as follows.
The reason for this supplementary plan stems from our efforts to recover from the lack of financial resources due to the 2013 deficit of subsidy and transfer by reducing the appropriation budget drastically and conserving the tax revenue deficit.
We've appropriated the funds for personnel expenses and essential expenditures, and are expecting to undergo a deliberation from the City Council for 2015 budget plan.
Uncontrollable expenditures, which include wages and welfare spending, making up for 90% of the total 2015 budget of about 7.7 trillion won and having increased by more than 201 billion won from last year, totals to approximately 6.9 trillion won.
Thus, with the soluble revenue for student education enhancement, education policy implementation and school facilities improvement programs only being 10% of the total revenue, our hands are tied in producing an autonomous budget plan.
This dire financial situation is a result of the decrease in subsidy, transfer and tax revenue and the increase in uncontrollable expenditures and annual expenses.
Not only that, insufficient funds is expected to total to at least 200 billion won every year until 2018 according to the midterm fiscal plan. The central government and local governments will have to work together to devise with a solution for the structural fiscal problem of district education.
In order to recover from this financially dangerous situation, S.M.O.E focused on reorganizing unnecessary and minor programs in addition to eliminating or shrinking policy projects.
Personnel expenses, as well as work-related expenses, were cut by 20~30% compared to last year in an organization-wide effort to recover from the fiscally troubling situation.
We were able to set aside 91.4 billion won for only three months of preschool subsidy through these measures.
Furthermore, 637.5 billion won is to be issued towards funding essential programs for early retirement and school facilities.
Through these means, hopefully, we will be able to ease anxiety brought on by pension plan reforms, boost the morale of faculty, and promote a smooth circulation of manpower supply and demand, while creating the ideal educational environment by constructing new schools, improving school conditions and covering maintenance costs for students' safety and old buildings.
Funds Issued by Local Education Govt. £¿ budget for school conditions and environment improvement: KRW 381.4b. ⇒ new construction (21 schools), annex construction (23 schools), etc - KRW 211.4b. ⇒ maintenance of old facilities, etc - KRW 170b. £¿ budget for early retirement: KRW 256.2b. ⇒ early retirement compensation for faculty: '14 KRW 66.116 b.(554 people) → '15 KRW 256.23 b.(1,627 people)
Funds Issued by Local Education Govt.
£¿ budget for school conditions and environment improvement: KRW 381.4b.
⇒ new construction (21 schools), annex construction (23 schools), etc - KRW 211.4b.
⇒ maintenance of old facilities, etc - KRW 170b.
£¿ budget for early retirement: KRW 256.2b.
⇒ early retirement compensation for faculty:
'14 KRW 66.116 b.(554 people) → '15 KRW 256.23 b.(1,627 people)
From this point forward, we at S.M.O.E will go to great lengths in abolishing irresponsible spending and creating fiscal efficiency as we've taken the troubling budgetary conditions into account. Also, we will work with the national government and the National Assembly in attaining financial support from the national government for the remaining portion of preschool subsidy (274.3 billion won/ 9 months).
The 2015 S.M.O.E Budget is expected to be finalized on Dec. 16, 2014 after being reviewed by the Seoul City Council.