Surplus funds accumulated in the public asset management fund have more than tripled in the past five years. While revenue has increased due to expanded public asset sales, there are no established criteria for determining an appropriate holding level or principles for utilizing excess funds, which could reduce the efficiency of financial operations.
On July 12, the National Assembly Budget Office reported in its "Analysis by Committee of the 2025 Fiscal Year Settlement" that "the surplus funds of the public asset management fund are rapidly increasing alongside rising revenues from public asset sales," and emphasized the need to assess an appropriate level of surplus funds and to plan the use of excess resources for projects related to the fund's objectives, such as acquisition and development of public assets.
The public asset management fund was established to acquire, develop, manage, and dispose of public assets, operating on resources secured through the sale or exchange of general properties. The balance remaining after expenditures is accumulated as surplus funds.
According to the Budget Office, the surplus fund balance based on settlement criteria increased from 658.3 billion won in 2021 to 987.7 billion won in 2022, 1.4864 trillion won in 2023, 1.7477 trillion won in 2024, and expanded to 1.9981 trillion won last year. During the same period, the operational balance of surplus funds grew from 894.8 billion won to 2.2227 trillion won.
The issue is that the rate of increase in surplus funds significantly outpaces the actual growth in fund expenditures. Major expenditures from the public asset management fund, which include project costs and fund operation expenses, rose only about 14% from 932.3 billion won in 2021 to 1.0675 trillion won last year. In contrast, surplus funds increased more than threefold during the same period.
As a result, the gap between surplus funds and major expenditures has widened rapidly. In 2021, surplus funds were 274 billion won less than major expenditures, but by 2022, they exceeded expenditures by 151.5 billion won, and the gap grew to 4.976 trillion won in 2023, 7.637 trillion won in 2024, and reached 9.306 trillion won last year.
The rapid increase in surplus funds is attributed to the expansion of public asset sales. The government has been promoting sales since establishing the "Measures to Activate the Sale and Utilization of Idle and Underutilized Public Assets" in 2022. Consequently, revenues from the sale of public assets rose from 1.0398 trillion won in 2020 to 1.7872 trillion won last year, while land sale revenues maintained levels of 1.6686 trillion won in 2023, 1.9012 trillion won in 2024, and 1.7298 trillion won last year.
Lee Seok-won, a budget analyst at the Budget Office, pointed out, "As the scale of sales increases, the gap between appraised values and actual bid prices needs to be monitored separately."
The number of successful bids for public asset sales surged from 146 in 2021 to 891 last year, more than a sixfold increase. However, last year, the appraised value was 302.4 billion won, while the actual bid amount was 223.2 billion won, resulting in a discrepancy of about 79.2 billion won. The ratio of bid prices to appraised values has also steadily declined, from 102.0% in 2021 and 104.0% in 2022 to 90.8% in 2023, 77.6% in 2024, and 73.8% last year.
In response to these issues, the government announced measures to improve the public asset sales system at the end of last year, including strengthening reviews of high-value asset sales and limiting discounted sales. This year, the government is also pursuing amendments to the enforcement decree of the Public Assets Act to strengthen reviews of public asset sales and refine the requirements for negotiated contracts.
As a result, there are calls for a more systematic approach to managing the public asset management fund. The budget analyst stated, "It is limited to view the entire surplus fund as liquidity needed for short-term project execution. It is necessary to assess an appropriate level of surplus funds considering medium-term project plans, annual execution amounts, and the timing of expenditures for large-scale acquisition and development projects, and to actively utilize excess resources for new projects such as the acquisition of reserve land."
* This article has been translated by AI.
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