Public agencies' debts jump in 2009: gov't report

SEOUL, April 29 (Yonhap) -- Debts owed by South Korea's public institutes
including state-run companies jumped in 2009, a government report showed
Thursday, underlining its worsened fiscal status amid a protracted economic
downturn.
According to the report compiled by the Ministry of Strategy and Finance, debts
held by 286 state-run companies, quasi-government agencies and other public
institutes amounted to a combined 347.6 trillion won (US$311.7 billion) last
year, up 16.6 percent from a year earlier.
The increase mostly came from a hike in borrowings by public companies, which
owed a total of 212.1 trillion won, up around 20 percent from a year earlier, the
report showed.
The debt figures were unveiled ahead of its official posting on the
government-run disclosure system on Friday. They were announced along with other
statistics on business activities by public agencies.
Public-sector agencies have been cited as one of key areas that the government of
President Lee Myung-bak is pushing to reform, as they are frequently under fire
for lax management and generous benefits to employees.
The government says that its stepped-up reform drive has been paying off, saying
it has succeeded in enhancing business efficiency by cutting salaries, trimming
down business size and reducing benefits to staff and executives.
According to the report, the average annual salaries received by heads of the
public institutes fell 10.6 percent to 140 million won last year. Salaries for
ordinary workers also declined to an average 59 million won, down 1.6 percent
from a year earlier.
The number of employees declined as well. A total of 243,000 workers were on the
payroll of the 286 public institutes at the end of 2009, down 7.3 percent from a
year earlier. The decrease is attributed to layoffs, reduction in business size
through consolidation of overlapping businesses and less recruitment amid a
slumping economy.
With such reform efforts intensifying, profitability appeared to have improved.
The report showed that combined earnings by the public agencies jumped 60 percent
to 7.2 trillion won last year. The state-run power monopoly Korea Electric Power
Corp. and other energy companies led the hike, as they enjoyed robust profits
thanks to the stabilization of the local currency and oil prices, the report
explained.
Combined assets, meanwhile, increased 16.5 percent to 610.9 trillion won over the
cited period, the report showed. The hike was mainly due to expanded spending
aimed at building social infrastructure, energy facilities and helping small
businesses and low-income earners tide over the economic slowdown, according to
the report.
kokobj@yna.co.kr
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