Local autonomy at 30: Progress, but still stuck at '20 percent'

The two reforms are closely linked. When resources align with local responsibilities, residents’ perspectives change, and their support can in turn drive party and parliamentary acceptance of reform.

Ha Hye-soo The author is a professor of Public Administration at the Kyungpook National University and the former president of the Korea Local Administration Research Institute.

This year marks the 30th anniversary of the revival of Korea’s locally elected governments. A generation of experience invites a sober evaluation to prepare for the next. Over three decades, milestones have included the 1995 direct election of local government heads, the 2004 introduction of local referendums, the 2007 adoption of personnel cost controls and recall measures, the 2010 creation of a local consumption tax, the 2020 Local Affairs Transfer Act and the 2022 full revision of the Local Autonomy Act.

Election commission staffers check tallying equipment at the Seoul National University Gymnasium in Gwanak District, southern Seoul, on the eve of the June 1, 2022, local elections. [NEWS1]

The clearest achievement of the locally elected era has been shifting administration toward residents. Mayors and governors, now with set terms, have focused on community-based services that reflect local needs. Yet despite these advances, local autonomy remains confined to what experts call “20 percent autonomy.”

The numbers illustrate the imbalance. Local taxes made up only 21.2 percent of total tax revenue in 1995 and rose to 24.6 percent by 2023. The proportion remains stuck in the 20 percent range, far below the 36.5 percent share of administrative tasks assigned to local governments. The central government has delegated work and responsibility without transferring adequate resources, leaving local administrations exposed to failure. Specialists across the field argue that “30 percent autonomy,” achieved through bold transfers of national tax revenue, is the only path forward. Without such fiscal reform, next-generation local governance will remain constrained.

A deeper structural obstacle lies in the party nomination system. What appears to be robust electoral representation is, in practice, distorted by party control. Korea’s 1995 shift from appointed to elected local government heads replaced bureaucratic “official rule” with “self-rule,” yet party nominations quickly created “party rule.” Until 2002, parties could not nominate candidates for basic local councils, but since 2006, party nominations have expanded instead of receded.

Party nominations have some benefits for party responsibility, but they invite nomination scandals and entrench party dominance at the local level. Under the current system, local councilors and mayors must constantly navigate the expectations of party leadership and lawmakers in Seoul.

Among the dual challenges of resource transfers and party dominance, curbing party influence is the more urgent. Ideally, party nominations in local elections should be abolished. At a minimum, the current system should be replaced with a confirmation model: Candidates first win resident primaries, and parties simply endorse the local choice. Such a shift would reduce the abuse of party nominations while preserving the principle of party-based accountability. Lawmakers and parties claiming no intent to dominate local governments would have little reason to resist.

Fiscal reform cannot be ignored either. Local tax revenue must align with the scope of local responsibilities. If local governments handle 36.5 percent of national administrative tasks, they should receive at least 35 percent of tax revenue. Without matching resources, the quality of services will erode, public dissatisfaction will grow and local autonomy itself may face discredit.

Achieving “30 percent autonomy” will be far from simple. In 2023, national taxes totaled 344 trillion won ($248.2 billion) while local taxes reached 123 trillion won. Transferring 25 trillion won from national to local coffers would be necessary to reach the 30 percent threshold. Raising the local consumption tax — currently 25.3 percent of value-added tax revenue — to 35 percent would increase local revenue by only 7 trillion won. Without extraordinary measures, such as allocating 20 percent of corporate income tax — around 16 trillion won — to local governments, meaningful fiscal autonomy will remain out of reach.

Citizens look at campaign posters for candidates in the April 7, 2021, Seoul mayoral by-election posted on the fence of the Artist’s House in Ihwa-dong, Jongno District, central Seoul. [JOONGANG ILBO]

Korea now faces a choice: to accelerate the reforms left undone for 30 years, both in party nominations and resource transfers. Reforming nominations will require overcoming party and legislative resistance, while fiscal reform will demand persuasion of the Ministry of Economy and Finance and bridging deep revenue gaps. Yet these are challenges, not impossibilities. No knot remains tied forever, and no mountain is unclimbable.

The two reforms are closely linked. When resources align with local responsibilities, residents’ perspectives change, and their support can in turn drive party and parliamentary acceptance of reform. Minimizing party influence while maximizing fiscal transfer is the surest way to elevate Korea’s locally elected governments into a mature system of autonomy.

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.