Gwangju City Council Member Eunji Chae Calls for Flexible Fund Management

Excessive Accumulation of Overall Funds... Essential Funds Fall Short of Standards
City: "We Will Review Fund Management by Category and Prepare Improvement Measures"

Eunji Chae, Gwangju City Council Member.

As Gwangju City's debt has surpassed 2 trillion won, it has also been revealed that the city's fund management performance is underwhelming.

During the 2024 settlement approval review for the Planning and Coordination Office held on June 9, Gwangju City Council Member Eunji Chae (Democratic Party of Korea, Proportional Representation) pointed out, "According to the Ministry of the Interior and Safety's 2023 nationwide local government fund management performance analysis, Gwangju City ranked 16th out of 17 metropolitan cities and provinces."

Chae stated, "Gwangju City's 'fund accumulation ratio to fiscal revenue' stands at 12.3%, which is higher than the average of 8.7% for metropolitan local governments, indicating that funds have been excessively accumulated. On the other hand, the 'project expenditure allocation ratio' was only 33%, compared to the nationwide metropolitan average of 47%," adding, "This shows that the funds are not being properly utilized and are merely accumulating."

Moreover, while the overall funds have been excessively accumulated, the Disaster Management Fund, which is essential for citizen safety, has been allocated below the statutory standard for four consecutive years, exposing an imbalance in fiscal management.

Chae said, "Last year, Gwangju City allocated 8.7 billion won less than the statutory requirement of 18.7 billion won for the Disaster Management Fund, and this year, it failed to secure 10 billion won compared to the required 19 billion won," emphasizing, "A comprehensive review of fund management and administration is necessary."

Chae also pointed out that, as Gwangju City's debt has exceeded 2 trillion won, a flexible fund management strategy is needed to help reduce the debt ratio. She argued, "The concerns I raised last year about the city's debt surpassing 2 trillion won have now become a reality," and insisted, "To restore fiscal soundness, the city should actively consider ways to utilize its funds."

In response, a Gwangju City official explained, "We are currently operating 19 different funds, each being used for projects that align with their intended purposes. In particular, surplus funds that have not been used are deposited into the 'Integrated Fiscal Stabilization Fund' and are utilized to support major city projects through general account loans."

The official added, "However, as the fund management performance analysis pointed out that the allocation and execution of project expenditures for some funds are somewhat low, we will closely review the management status of each fund and prepare improvement measures to ensure more flexible and efficient fund management."

Meanwhile, as of the 2025 main budget, Gwangju City's local bond size stands at 2.07 trillion won, the highest among all metropolitan and special cities nationwide, and as of 2024, the city holds 1.0477 trillion won across 19 funds.