Hwaseong City on the Brink...Seeking a Breakthrough in Fiscal Crisis

Hwaseong City faces the risk of financial collapse, and since the 5th term of local government, it has become difficult to even pursue road repair projects or halt construction of public facilities.

Consequently, Hwaseong City had no choice but to resort to drastic measures such as cutting free school lunch support, reducing event budgets, and cutting civic organization subsidies. Last year, through four supplementary budgets, the city reduced expenditures by 113.9 billion won, cutting 956.93 million won in free school lunch support and halting construction of public facilities including the Jeongnam-myeon and Gibae-dong administrative buildings.

This year, the city also compiled a budget of 949 billion won by cutting 300 billion won from the annual budget scale of 1.2 trillion won to pursue fiscal austerity. It abolished festive events and cut childcare support budgets and civic organization subsidies in half.

Some pointed out that the city's fiscal crisis resulted from the populist, exhibition-oriented administration and lax budget management during the 4th term of local government.

◇Participatory Budgeting Ordinance Announced for Public Consultation

To avoid repeating the trial-and-error of the 4th term and overcome the current fiscal crisis, public opinion suggests that institutional safeguards must be established to enable predictable budget management. To date, the Hwaseong City Council and civic organizations such as Hope Alliance have advocated for the introduction of participatory budgeting to ensure transparent financial management.

With participatory budgeting, the budget compilation process includes briefing sessions, public hearings, and forums, and when necessary, written or internet surveys on major projects and solicitation of business proposals are conducted to gather public opinion.

Therefore, the feasibility of projects and predictable budget management become possible. Accordingly, the city submitted a participatory budgeting ordinance on the 29th of last month and announced it for public consultation.

◇Restraint on Improvised Budget Execution...Building a Financial Management Evaluation System

The city is currently building a system in which citizens directly participate in budget planning for predictable financial management, and appropriateness is evaluated even after the budget is executed.

The city plans to refrain from ad-hoc budget execution based on the will of local government leaders, establish medium- to long-term fiscal plans, and maximize project effectiveness through planned resource allocation. To this end, the city announced the 5th term financial management plan and released plans for securing resources and budget execution by fiscal year.

The city is introducing a sunset clause for all projects to secure available resources and believes it can escape liquidity crises of capital.

The city will also conduct deliberation and evaluation activities on exhibitions and festivals currently held without distinctive features and self-developed specialized festivals in eup, myeon, and dong areas to determine whether to maintain or abolish them, thereby reducing budget waste.

Kim Haeng-nim, Director of Planning and Budget for Hwaseong City, said, "From now on, citizens will obtain sufficient information and be able to express their opinions at the budget planning stage, so participatory budgeting will play a major role in transparent financial management."

Director Kim also stated, "We will introduce sunset clauses for projects and meet citizens' right to information through financial disclosure and financial crisis management systems."