2026 National Assembly Audit: Dispute Over Local Education Funding Reform

During a National Assembly audit on October 14, lawmakers engaged in a heated debate regarding the government's proposed reform of local education funding. Education officials warned that the changes could lead to significant financial shortfalls, forcing immediate cuts to student programs and the issuance of local bonds. They argued that the funding reform should prioritize hiring essential personnel, such as special education teachers and cafeteria staff, to ensure student safety and future talent development.

Rep. Seo Beom-soo of the People Power Party emphasized the potential financial losses for metropolitan education offices under the proposed formula. He stated, "If the new formula is applied, Seoul could lose 2.7 trillion won, Gyeonggi 7.4 trillion won, and Incheon 1.6 trillion won. Based on the Ministry of Education's estimates, Seoul is projected to face a budget shortfall of 1.4 trillion won, Incheon 545.9 billion won, and Gyeonggi 300 billion won. After accounting for personnel and operational costs, the funds available for student programs will inevitably decrease."

In response, Seoul Education Superintendent Jeong Geun-sik noted, "Despite making significant budget cuts for next year, we still face a dire situation. Even with the use of stabilization and environmental improvement funds, we may have to issue local bonds with negative balances in the near future."

Conversely, Rep. Park Beom-gye of the Democratic Party criticized the education offices for their inadequate self-funding and unspent budgets. He pointed out, "Local governments are only utilizing 71% of the legally mandated transfers in Daegu and 88.8% in Seoul. Are they blaming the funding reform while failing to use the resources properly?" He also questioned the significant unspent amounts despite a reduction in the unspent rate from 12.8% to 1.9% in the Seoul education office. Superintendent Jeong explained that the legal transfers are settled within three years and that previous large unspent amounts were due to unique circumstances, such as the budget for the Green Smart project in 2022, which was influenced by a surge in tax revenue.

Rep. Lee In-seon of the People Power Party highlighted the distorted spending structure in schools amid the funding reduction debate. He stated, "While spending on fixed costs like personnel has surged, funds for facility repairs directly related to student safety have decreased by 36%, and equipment purchases have dropped by 34%." He added, "Despite an 8.1% decrease in student numbers, spending on textbooks has skyrocketed by 82% (98% per student), and public utility costs have risen by 44.6%. We need to eliminate wasteful spending and normalize basic operational costs for schools."

In response, the Ministry of Education's Planning and Coordination Office Director Seol Se-hoon stated, "We are discussing reforms to enhance the efficiency of local education funding." Superintendent Jeong expressed concern that 80% of the Seoul education office's budget is tied to fixed costs, which severely hampers efforts to address educational disparities and improve safety in schools.

Rep. Ko Min-jung of the Democratic Party challenged the logic behind the education officials' claims of budget cuts. She argued, "The claims of a 900 billion won reduction in Chungbuk and 25 trillion won in Seoul are based on uncollected surplus taxes from the semiconductor boom, creating an illusion. Compared to the confirmed budget for 2026, the projected funding for 2027 will actually increase across all regions when adjusted for inflation."

She added, "Claiming cuts based on money that hasn't even been collected is merely a 'phantom review.' The remaining funds, excluding the natural increase in personnel costs (approximately 1.6 trillion won), and the Future Response Fund should be prioritized for hiring essential personnel, including special education teachers, librarians, psychological counselors, and cafeteria staff, who are urgently needed due to legal changes."

In response, Yoon So-young from the Gyeonggi Provincial Office of Education's Planning and Coordination Office stated, "To meet future educational demands and ensure safety, the total education budget must continue to increase. If Rep. Ko's suggestions are implemented, we will ensure that the Future Response Fund is used to strengthen personnel such as librarians, counselors, sports instructors, and cafeteria staff, as well as to improve literacy education and upgrade aging school facilities."

Former National Assembly Education Committee Chair An Min-seok criticized the government's approach to the funding reform and the lack of educational philosophy. He stated, "I met with representatives from both parties on September 10 to express the education sector's concerns about the funding reform. The lack of a public discussion process and the absence of a national educational philosophy suitable for the AI era, focusing solely on the 20.79% domestic tax linkage ratio, is very regrettable."

Chair Kim Hee-jung of the National Assembly Education Committee emphasized, "We must not hastily handle such a significant issue that could change the framework of education. Both the National Assembly and the education offices share this understanding and must communicate effectively with the education sector."