When it reviews the closing account, the National Assembly should screen not only individual projects but also overall national fiscal management. To achieve this goal, the National Assembly Budget Office (NABO) published a report, Aggregate Macro Analysis on FY 2014 Closing Account, in order for the National Assembly to thoroughly deliberate on the results and issues of national fiscal management during the review.
The report evaluated the overall results of fiscal management for fiscal year 2014 and focused its analysis on issues concerning fiscal management.
The total revenue of fiscal year 2014 was KRW 356.4 trillion, which was KRW 12.9 trillion less than the expected amount. Such deficit occurred for three consecutive years. The total expenditures were KRW 347.9 trillion, which was KRW 7.9 trillion less than planned budget. The balance of the consolidated central government after subtracting the total expenditures from the total revenues was KRW 8.5 trillion (0.6% of GDP), recording a surplus. However, the balance was KRW 29.5 trillion (2.0% of GDP) on the basis of government balance under management, showing a deficit.
The Office suggested that the National Assembly set the revenue budget at an optimal level and aggressively reconstruct tax expenditures to restore the already-deteriorated financial integrity in its early stages.
The report also calls for efficient fiscal managements by such means as thorough business planning and budget compilation, which is enforceable within a year. The Assembly should reach this suggested efficiency by analyzing the following: new business, project for which budgets are allocated on an ad-hoc basis, business with inactive annual budget execution, the use and diversion of budget funds, and changes in fund management-plans.
Lastly, the report proposes ways to reserve an appropriate level of surplus funds by analyzing extra cash that 64 funds hold. Also, the paper indicates ways to improve the evaluation system on fund operation by looking into the present status and problems of the government pension fund investment pool system, which was designed to facilitate asset management of small and mid-sized funds.
Budget Analysis Office
The report evaluated the overall results of fiscal management for fiscal year 2014 and focused its analysis on issues concerning fiscal management.
The total revenue of fiscal year 2014 was KRW 356.4 trillion, which was KRW 12.9 trillion less than the expected amount. Such deficit occurred for three consecutive years. The total expenditures were KRW 347.9 trillion, which was KRW 7.9 trillion less than planned budget. The balance of the consolidated central government after subtracting the total expenditures from the total revenues was KRW 8.5 trillion (0.6% of GDP), recording a surplus. However, the balance was KRW 29.5 trillion (2.0% of GDP) on the basis of government balance under management, showing a deficit.
The Office suggested that the National Assembly set the revenue budget at an optimal level and aggressively reconstruct tax expenditures to restore the already-deteriorated financial integrity in its early stages.
The report also calls for efficient fiscal managements by such means as thorough business planning and budget compilation, which is enforceable within a year. The Assembly should reach this suggested efficiency by analyzing the following: new business, project for which budgets are allocated on an ad-hoc basis, business with inactive annual budget execution, the use and diversion of budget funds, and changes in fund management-plans.
Lastly, the report proposes ways to reserve an appropriate level of surplus funds by analyzing extra cash that 64 funds hold. Also, the paper indicates ways to improve the evaluation system on fund operation by looking into the present status and problems of the government pension fund investment pool system, which was designed to facilitate asset management of small and mid-sized funds.
Budget Analysis Office