Construction 'Gongjejoap' Innovation... Reducing Number of Operating Committee Members and Shortening Terms

Ministry of Land, Infrastructure and Transport Announces Legislative Notice for Amendment to Enforcement Decree of the Framework Act on the Construction Industry

(Data from the Ministry of Land, Infrastructure and Transport)

[Asia Economy Reporter Moon Jiwon] The government will innovate the decision-making process and operational methods of construction-related mutual aid associations to ensure more transparent management.

The Ministry of Land, Infrastructure and Transport announced on the 29th that it will publicly notify the amendment to the Enforcement Decree of the "Framework Act on the Construction Industry" for 40 days from the 30th until January 11 of next year.

Mutual aid associations such as the Construction Mutual Aid Association, the Specialized Construction Mutual Aid Association, and the Mechanical Equipment Mutual Aid Association have been responsible for contract performance guarantees and financing for construction companies since the 1960s, when financial institutions were insufficient.

However, as the construction industry environment has changed recently with the activation of direct construction and the implementation of the wage direct payment system, there have been many calls for more transparent and efficient decision-making systems and operational methods to be introduced in mutual aid associations.

First, the Ministry of Land, Infrastructure and Transport decided to improve the composition of the operating committee through the amendment of the enforcement decree.

The number of members of the operating committee increased from 7 in 1963 to 30 to allow for diverse opinions to be discussed, but for efficient operation and smooth communication, it will be reduced to 21 members.

Instead, it was stipulated that operating committee members representing various members can be elected according to criteria set by the Minister of Land, Infrastructure and Transport, such as the scale of investment, to ensure balanced reflection of members' opinions in the association's management.

Also, the current term of office for operating committee members will be reduced from 3 years to 1 year, and reappointment will be limited to once. Previously, the 3-year term and no limit on reappointment restricted opportunities for participation by diverse members and experts.

The Ministry of Land, Infrastructure and Transport clarified that one external private expert and one member from the association members will serve as co-chairpersons in the decision-making process of the association, and the election method will be a direct, anonymous secret ballot.

Furthermore, procedures for submitting agenda items to the operating committee were established, and other necessary operational matters can be regulated by Ministry of Land, Infrastructure and Transport notices, thereby revising the laws.

This amendment will be implemented two months after promulgation, following consultations with related ministries and regulatory reviews.

Joo Jongwan, Director of Construction Policy at the Ministry of Land, Infrastructure and Transport, said, "We will actively promote the overall efficiency of management of construction-related mutual aid associations," and added, "We plan to prepare improvement plans for major tasks centered on the dedicated organization for mutual aid association management innovation and report them to the Construction Industry Innovation Committee to be held in January next year."