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Lessons Learned and Challenges Overcome

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Lessons Learned and Challenges Overcome06



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Title Lessons Learned and Challenges Overcome
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Material Type Report
Date 2015
Language Korean
File Type Theme
Subject Government and Law < Public Administration
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Abstract

Liu (forthcoming) summarizes the lessons to be learned and challenges to be overcome from the case of the performance evaluation systems in Korea as follows.

 

The central government of Korea adopted performance-oriented reforms in order to make its ministries and agencies pay closer attention to their performance, which means to attain their planned goals and objectives. The reforms also aimed to make them responsible for their expenditures. The early stage of the performance-oriented evaluation system was SABP starting in 2005, which let the central ministries assess their expenditure programs themselves. After about ten years, MOSF developed the system into IESGP in 2016. Both SABP and IESGP provide MOSF with practical tools to evaluate the performance of all expenditure programs by the central ministries of Korea.

 

MOSF and other central ministries subject to performance evaluation found that it was not possible to apply some generalized evaluation criteria to all expenditure programs, particularly to programs whose performance was not easy to quantify. Most central ministries and agencies did not have sufficient knowledge and expertise to evaluate the performance of their expenditure programs quantitatively. In this perspective, MOSF was required to provide them with practical help and financial support including consultation services on how to develop their performance indexes and use them appropriately. MOSF also required to make effective incentive systems and a penalizing mechanism to increase their participation in the performance evaluation system.

 

MOSF found that many central ministries and agencies carried out many deceptive practices relating to the performance evaluation system. They artificially inflated the self-assessment of their expenditure programs. As for their budget adjustment, they assigned programs for which an actual budget cut would not be available for some reason. MOSF should take heed and uncover these practices by the central ministries and agencies, which impede the effective performance evaluation of government expenditure programs.

 

One of the most important objectives of a performance evaluation system is to link the performance evaluation scores of government expenditure programs with the budget, which is assigned to the programs in the process of budgeting. However, the Korean cases of SABP and IESGP showed that the mechanism linking performance with budgeting did not work as effectively as anticipated. There existed two phases for this linkage. First, MOSF should reflect the performance evaluation scores of all expenditure programs when it compiles the executive budget. Second, the National Assembly of Korea also should consult the performance evaluation scores of ministerial programs when it appropriates resources across the expenditure programs. Under the previous and current performance evaluation systems, the association between the performance scores of the expenditure programs and the budget assigned to the programs was not clear. When the central ministries are not sure of a clear association between performance scores and budget, they would lose motivation to comply with the performance evaluation systems. Thus, both MOSF and the National Assembly should seek out effective ways to reflect the performance evaluation scores of government expenditure programs in their budget in the course of budget compilation and appropriation, which will result in performance improvement of government expenditure programs and effective resource allocation across government programs.