KIHASA has published the December issue of the Health and Welfare Policy Forum (No. 338), with its monthly focus on the "Prior-Consultation System for New or Modified Social Security Projects: Changing Trends and Directions for Improvements." (Click here to download the articles.)

SUMMARY OF THE FOREWORD

The amendments made in 2013 to the Framework Act on Social Security stipulate that any central government administrative agency or local government intending to implement a new social security project or modify an existing program must consult beforehand with the Minister of Health and Welfare. The prior-consultation system extends beyond social security projects. For example, a local or central government agency planning a project to support small- and medium-sized businesses must first consult with the Ministry of SMEs and Startups. In addition, digitalization projects are subject to prior consultation with the Ministry of the Interior and Safety.
While local governments are accorded autonomy by the constitution, they must, as long as their local affairs are subject to compliance with the corresponding Acts, consult with the Ministry of Health and Welfare when implementing a new social security project or making changes to an ongoing program, as Article 26 of the Framework Act provides. To be sure, prior consultation by the Ministry of Health and Welfare should be conducted without compromising local autonomy. The social security prior-consultation system has been criticized for infringing upon local autonomy, but there is also a view that it has, through its processes of policy consultation and information sharing, contributed to the systematic design of social security projects and enhanced the complementarity between programs undertaken by central government agencies and those by local governments.
This December issue of the Health and Welfare Forum focuses on the social security prior-consultation system. The thematic articles herein explore the roles of the system and the rules and standards by which it has been operating. Based on their discussion of the system’s policy outcomes, the authors of the articles present suggestions for improving the system. Achieving a perfect institutional mechanism is unlikely, but what’s important is that with scrutiny and effort, we identify the flaws, remove them, and make the system better over time. We hope that this month’s issue of the Health and Welfare Forum will provide readers with an occasion to revisit the social security prior-consultation system and to think about what it would take to improve it.

FOCUS OF THE MONTH: The Prior-Consultation System for New or Modified Social Security Projects: Changing Trends and Directions for Improvements

"Changes in Local Welfare Programs under the Latest Prior-Consultation Directions for Social Security Projects," Ham Young Jin & Lee Woncheon, KIHASA

The Social Security Committee in October 2023 adopted “enhancing welfare for the weak” and “systematizing social services” as basic directions for the prior-consultation scheme. This article examines the changing features of social security projects placed under prior consultation by comparing the six months preceding the announcement of the new policy paradigm with the six months following. Since the announcement, the number of cash benefit programs subjected to prior consultation has decreased, whereas programs focusing on ‘welfare for the weak’ and ‘social services’ have increased. While such shifts may have resulted from the implementation of the new policy paradigm, a thorough analysis of these changes requires detailed data on the prior-consultation process. To build confidence in the prior-consultation scheme as a policy tool, it is essential to educate and support local officials in designing social security projects and to systematize the procedures involved in the scheme. These steps should lead to a well-informed analysis of shifts in the prior-consultation policy after the Social Security Committee’s new policy paradigm.

"Current Status and Key Challenges of Prior-Consulted Local Social Security Projects for Youth," Song Soo Jong, Korea Employment Information Service; and Hwang Seong Hwan, KIHASA

In this article, I examine the progress made in prior consultations regarding social security projects on youth employment, explore recent trends in these youth support initiatives, and present key issues raised during the consultations. From this I derived responses to these issues that local governments should consider when putting up youth employment support programs for prior consultation. I reviewed basic data from consultation applications for a total of 170 youth employment projects on which prior consultations were completed during the 3-year period between 2021 and 2023. Building on this review, I then analyzed their key features―target groups, details of the support offered, the amount of benefits per recipient, the forms in which benefits are delivered, total budget, eligible ages, and so forth. From this analysis I ascertained that a key issue inquired into in all prior consultations was how a new project or proposed expansion connects to existing programs―whether it is duplicative of or supplemental to them. Other concerns taken seriously during the prior consultations include who the program intends to support, based on what selection criteria, and in what forms and amounts.

"Prior-Consultation as a Strategy for Central-Local Cooperation in Social Security: With a Focus on Cash Benefit Programs," Lee Young-Jae, Ministry of Welfare

Introduced in 2012, the prior-consultation system, serving as a policy channel through which central and local governments deliberate together to achieve balance and inter-complementarity in their social security projects, helps reduce such perennial issues as ‘delivery overload’ and ‘diseconomies of scale,’ characteristic of small-scale, fragmented projects that are similar and duplicative. This article examines how the prior-consultation system encourages local governments to move away from zero-sum cash benefit contests, transforming potential non-cooperative situations into cooperative ones. The prior-consultation system is discussed here as a useful framework that can transform a Nash equilibrium, arising from asymmetrical conditions under which agents cannot trust each other, into an optimal equilibrium.

"The Social Security Prior-Consultation System: Achievements and Improvement Strategies," Weon Soyoon, Chung-Ang University

In this article, I analyze the prior-consultation system based on findings from in-person interviews with local officials responsible for its implementation, and discuss potential improvements to the system. My analysis indicates that the consultation system has, as intended, enhanced the efficiency of the social security system, contributing to some extent to local governments financially by curbing the indiscriminate expansion of cash welfare programs. However, achieving “social-service-led local welfare”―a key direction deliberated and agreed upon by the Social Security Committee in October 2023 ―requires not only improvements to the prior-consultation system and its procedures but also a comprehensive overhaul of social security governance.

POLICY ANALYSIS AND TRENDS

"Current Status and Challenges of Maternity Protection Policies: Implications for Female Workers and Beyond," Choi Jihee, KIHASA

Life events such as marriage, childbirth, and parenting, which women experience throughout their lives, exert a direct effect on their labor market participation. I examined the past twenty years of amendments to laws concerning maternity protection to identify the causes of women’s career interruptions, their tendency to accept lower-quality jobs after such interruptions, and the challenges married women face in balancing family and work. I also sought to identify key areas needing policy interventions. Although there have been speedy enhancements in maternal protection programs following the broad-scale amendments made to relevant laws in 2001, these improvements primarily represent an expansion of benefit levels, not of the target population, leaving the gap between workers eligible for support and those ineligible unfilled. Stable support measures are needed to help employers effectively manage workforce coverage during employees’ childbirth or childcare leave. In addition, the term “maternity protection” should be revised to foster recognition―legal, institutional, and social―that the issues covered by maternity protection laws extend beyond maternity protection proper and are relevant to more than just women.

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