Regulatory Reform Committee Must Be Made Permanent to Fulfill Its Role

For our society to regain vitality, we must undertake regulatory reform. Although there is a Regulatory Reform Committee, its role and scope are limited, so it would be desirable to make it a permanent body.

There is a big difference between having and not having a government ministry dedicated exclusively to regulatory reform. The current Regulatory Reform Committee, which is under the President, is significantly inadequate to fulfill its role. Administrative affairs are handled by the Regulatory Reform Office under the Office for Government Policy Coordination in the Prime Minister’s Office, while the government-side members include the Prime Minister, the Minister of Economy and Finance, the Minister of the Interior and Safety, the Minister of Trade, Industry and Energy, the Minister of SMEs and Startups, the Minister for Government Policy Coordination, the Chairperson of the Fair Trade Commission, and the Minister of Government Legislation, making it a structure ill-suited to regulatory reform.

Because it has failed to secure legal status, the role of the Regulatory Reform Committee is extremely limited. It is confined to deliberating and coordinating such matters as the basic direction of regulatory policy and matters concerning research and development, matters related to the review of new or strengthened regulations, the review of existing regulations, and matters concerning the establishment and implementation of a comprehensive plan for regulatory improvement. It cannot undertake substantive regulatory reform.

Because its role is limited, the Regulatory Reform Committee is unable to respond effectively to the logic used by government ministries to defend regulations. Moreover, most of the personnel working for the committee are officials seconded from other ministries, making it impossible to ensure continuity in its work. Tasks such as improving individual regulations and responding to regulatory reviews are outsourced to outside experts, resulting in one-off, fragmented, and merely formal operations. Its budget is also temporary, which further weakens its capacity.

To implement regulatory reform effectively, the Regulatory Reform Committee needs to gain legal status as a permanent body. The core elements are the appointment of standing commissioners, securing an independent budget, and establishing an independent secretariat. Only by securing such an independent standing can substantive regulatory reform become possible. Standing commissioners should be appointed to oversee specific areas rather than serving as temporary members. The committee must also break away from its politically structured composition and be able to formulate its own budget independently if it is to push forward meaningful regulatory reform.

Past administrations have attempted regulatory reform, but the results were not significant. The reason is that regulations were not substantially eliminated. Efforts were limited to a superficial approach focused on the number of regulations and total regulatory volume, while failing to abolish core regulations such as entry regulations and price controls. In addition, because most regulations are densely layered in double and triple legislative form, removing one often has little effect because others remain in place. Therefore, multiple regulations need to be grouped together and approached comprehensively.

Regulatory reform is most effective when carried out together with reform of the government’s public sector. Government ministries want to preserve regulations for the benefit of their own organizations. It is typical behavior for government organizations to prioritize their own power and influence over the harm regulations inflict on the public. Therefore, the Regulatory Reform Committee must be able to carry out its role while maintaining independence from pressure exerted by powerful ministries.

If more regulations are created than abolished, the effect of regulatory reform is cut in half. Therefore, the Regulatory Reform Committee must secure legal status that allows it to review the validity of newly introduced regulations during the legislative process and express its views on them.

Our society is losing its vitality. That is because regulations have choked off every sector of society to the point where it can hardly breathe. We must exercise the wisdom to loosen regulations so that freedom can once again be enjoyed. Fortunately, the Yoon Suk Yeol administration has declared its commitment to politics oriented toward freedom. Reforming legal, regulatory, and institutional problems in which we lag behind other advanced countries is an essential task for advancing freedom.

Regulatory reform is the surest way to allow freedom in real life. The government should explain how regulatory reform benefits the public, win public support, and use that support as momentum for reform. Furthermore, it must establish a dedicated body capable of carrying out regulatory reform and clearly demonstrate its commitment to action.

Sung-no Choi, President, Center for Free Enterprise (CFE)

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Original title: 규제개혁위원회, 상설기구화 해야 제역할

Author: Sung-no Choi

Date: 2022-12-26

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&idx=25231