Major unions slam 'backroom' restructuring of 109 public institutions approved in one hour

South Korea's two major labor federations criticized the government Thursday for rushing through a plan to reduce the number of public institutions by 109 — a measure approved in just one hour — and called for an end to what they described as backroom policymaking. The labor groups said consultations with the government had amounted to little more than a formality, and demanded that the necessity and appropriateness of the consolidations be re-examined from the ground up rather than simply discussing how to implement a plan already decided.

The joint public-sector task force of the Federation of Korean Trade Unions and the Korean Confederation of Trade Unions (KCTU) issued a joint statement Thursday expressing concern and regret over the government's public institution reform plan announced that day, saying it "contains numerous consolidation and function-adjustment measures that risk rolling back public services to the people."

According to the task force, the government plan calls for merging, splitting or adjusting the functions of more than 190 entities — including both designated public institutions and undesignated bodies — to achieve a net reduction of 109 institutions. The task force brings together five industry-level union organizations: the Federation of Korean Trade Unions' public workers' federation, financial workers' union and public service federation, along with the KCTU's public transport workers' union and health and medical workers' union.

Labor groups took issue with the fact that the cuts were concentrated among subsidiaries and smaller institutions.

The task force said subsidiaries and small-scale institutions account for 76.1 percent of the 109 targeted for reduction, and that "in most cases the appropriateness of the mergers and their potential problems have not been properly verified." It also raised the question of whether subsidiaries and small institutions had been indiscriminately swept in simply to meet the president's directive of a 20 percent reduction target.

The task force particularly said that horizontally merging subsidiaries established during the conversion of irregular public-sector workers to permanent employment would not resolve the underlying problems on its own. It said the expansion of prime contractors' responsibilities and genuine improvements in working conditions must accompany any such consolidation.

The groups also criticized the policymaking process itself, saying a small circle of bureaucrats and experts had drawn up the plan behind closed doors, with no meaningful input from unions, users of public services or broader public deliberation.

They further criticized the Public Institutions Operation Committee, convened at 9:30 a.m. Thursday, for approving the reduction of 109 institutions in just one hour. While the government and the two major federations had held several rounds of consultations, those discussions had been superficial, the task force said, adding that future consultations would not constitute genuine dialogue if they were limited to discussing how to carry out a plan already finalized.

The labor groups did, however, express agreement with the need for public institution reform in principle.

They said public institutions must transform to address compounding crises such as inequality and climate change, but argued that the direction of reform should be to strengthen the public nature of public services and democratize operations away from bureaucratic control. While they acknowledged that plans such as the integration of the five power generation companies and the merger of Korail and SR are already moving forward with social consensus, they said the current package also includes a number of consolidation plans that have long drawn concern and controversy.

The task force called on the government to publicly verify the necessity and appropriateness of each individual consolidation and function adjustment, and to suspend or halt any measures found to be problematic or highly contentious.

It also urged the government to take steps to prevent job insecurity, a reduction in youth employment and a deterioration of working conditions resulting from the consolidations. It said the government must guarantee total headcounts and overall employment levels, and put in place effective measures — including budget support and adjustments to total labor costs — to raise working conditions across the board. It called for the immediate launch of a regular, stable labor-government consultative body involving the government, the two major federations and public-sector labor.

"If the goal is to strengthen public accountability and democratically reform the operation of public institutions, we will cooperate actively with the government," the task force said. "But if the government presses ahead with reforms aimed solely at cutting the number of institutions and reducing costs — without sufficient verification and social consensus — and continues its backroom administration, it will face a powerful response from public institution workers and the public."