All Departments and Staff Mobilized for a Month to Identify Regulations
Improvements in the Construction Sector, Including Reflection of Appropriate Construction Costs
Promotion of Simplified Information Project Reviews and Contract Examinations
Seoul City will abolish the 'Mandatory 50% Direct Construction Execution Plan,' which was introduced to address excessive subcontracting issues. The aim is to revitalize the construction industry by easing habitual regulations in the public construction sector. Additionally, the review process required before integrating new digital technologies such as AI (Artificial Intelligence) into administration will be significantly improved.
On the 9th, Seoul City announced a large-scale deregulation plan consisting of 10 items, including lifestyle regulations that cause inconvenience to citizens, in line with Mayor Oh Se-hoon's policy direction of 'deregulation' for the new year. This was the result of a focused effort throughout January, where all departments and employees of Seoul City identified and discussed regulations to abolish or improve from the citizens' perspective.
The 10 deregulation proposals announced this time reflect the recommendations presented by the 'Construction Industry Deregulation TF,' which has been operating since December last year, and the 'Deregulation Expert Review Committee,' which held its first meeting on the 6th.
Deregulation Proposal No. 13 is the 'Abolition of the Mandatory 50% Direct Construction Execution Plan.' Seoul City had expanded the direct construction obligation to improve the habitual subcontracting problem of prime contractors lacking direct construction capabilities. However, since the plan was promoted without ensuring the industry's capacity to comply, it was also evaluated that the burden on the industry increased. Recently, due to the downturn in the construction market and the sharp rise in construction costs, large-scale SOC projects have repeatedly failed to attract bids. Therefore, the 'Mandatory 50% Direct Construction Execution Plan' will be completely abolished. Instead, the direct construction ratio evaluation will be preferentially applied from this year during bidding.
Deregulation Proposal No. 14 is 'Reflecting Appropriate Construction Costs Considering Urban Characteristics.' Reflecting the voices of the construction industry struggling with rising material and labor costs, Seoul City will promote the realization of public construction costs by strengthening the application of surcharges for small-scale projects and urban characteristics.
Seoul City will also abolish the convention of only reflecting the labor costs of traffic controllers at construction sites in construction costs and will include legal insurance costs such as industrial accident and employment insurance premiums in 'Reflecting Legal Expenses Including Traffic Controller Insurance Fees.' As Deregulation Proposal No. 15, Seoul City plans to provide customized education and consulting from the design stage to ensure that statutory expenses are not omitted from construction costs, in cooperation with district offices and business sites.
Deregulation Proposals Nos. 16 to 19 focus on improving various administrative regulations that hinder adaptation to new environments and industrial development, such as digital new technologies. Proposal No. 16 is 'Improvement of the Information Project Review Procedure,' which is essential before integrating digital new technologies such as AI and big data into administration. The core idea is to integrate or coordinate similar and duplicate reviews and simplify them according to the characteristics of each project to promote information projects more actively and swiftly.
Proposal No. 17 will revise the 'Standard Price for Acquisition, Disposal, and Management of Public Property,' which has remained unchanged for over 15 years since 2008. Considering the rise in real estate prices, Seoul City plans to start in-depth discussions with the Seoul Metropolitan Council to amend the ordinance to raise the review standards for acquisition and disposal from 500 million KRW to 1 billion KRW and the management standard from 2 billion KRW to 4 billion KRW. Additionally, Proposal No. 18, 'Realization of Contract Review Targets and Standards,' includes temporary exclusion of contract reviews for leading projects in advanced industrial fields, and Proposal No. 19, 'Improvement of Climate Budget System Operation,' which addresses the workload caused by project departments directly selecting and classifying targets, will also be pursued.
Furthermore, measures focusing on improving citizen inconvenience, such as expanding the target users of public facilities, extending operating hours, and simplifying procedures, were also presented. These include 'Expansion of Seoul-type Kids Cafe User Eligibility' (No. 20), 'Simplification of Procedures for Moving into Startup Support Facilities' (No. 21), and 'Extension of Public Facility Operating Hours' (No. 22). Kim Hyung-rae, Seoul City's Planning Officer, said, "We will continue to communicate with the field and experts to improve unnecessary regulations in all areas related to citizens' daily lives."
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