Basic Report

In October 2018, government presented ‘Fiscal decentralization promotion plans’, which include action plans to transforming functioned programs of central government to local government accordance with increasing rate of local sales tax. Also, those plans has enforced form 2020. At that time, basic principle for transforming functioned programs was local affairs have taken accountability to local government respectively.
   This study is to examine whether proper functions have transformed to local governments with respect to ensuring local fiscal autonomy and accountability by analyzing transformed programs. In addition, this study is to suggest ensuring plans to executive ability of transforming and transformed programs in fiscal decentralization step 1 and 2. For doing so, this study conducts related literature review, interview in first research stage and utilize perception survey to public officials in local governments with based upon first research stage.
   First of all, the result of this study shows autonomy of local governments have enlarged with regard to fiscal perspective. In specific, first, it is possible to adjust the budget by reducing and increasing in the field of social welfare and cultural/sports. Second, although limit, it is possible to adjust the schedule for each project according to the urgency of the programs. Third, it is possible to be internalized to external procedure. In addition, the result reveals that local governments with higher fiscal power have recognized to be improved fiscal autonomy accordance with fiscal decentralization. Furthermore, local governments with a small number of transforming functioned programs show a trend to agree with sun-set of transforming functions.
   Next, this study has reviewed fiscal planning regarding to fiscal accountability by comparing to carry-over before and after transformation. It has revealed that after carry-over have reduced.
   Finally, this study has conducted survey to public officials in local governments. The perceptions of public officials are followings. First, interest of local executives and local councils to local finance regarding to accountability. Second, enhancement of local fiscal soundness is similar to before transformed functions. Third, maintenance programs to local river and water supply expansion have to be returned to grant-aid program. It is because that the case of local river and water supply expansion have directly connected to the quality of life and universal rights of local residents.
   Therefore, based upon above results, this study suggests following regrading to ensuring plans to executive ability of transforming functioned programs. First, it need to be deleted statute and rule of central government with respect to transforming functioned programs and it need to be enacted as local statue and rule after 2026. Second, it need to be enforced performance evaluation of transforming functioned programs. For doing so, performance evaluation index has to include more specific objective index and focus program performance rather than simple execution performance and discretion degree. Finally, this study suggest that ongoing review process is needed with regard to compatibility to transforming functioned programs such as local river and water supply which are necessary to cooperate to central and local government. It is because that those programs are essential but possibility to reducing budget in local governments.