Public Management Division, Seoul Metropolitan Government

The Problem

Refurbishment projects mean urban planning projects to redevelop areas which require restoration of urban functions, or simply phrased: to develop residential environments in poor conditions systematically or improve old and inferior structures into efficient prosperous ones. The previous method of conducting refurbishment projects began with public authorities establish urban plans with more than 400 landlords to organize an association, which empowered by the consents of residents in the refurbishment district, completed redevelopment according to the public plans. After the refurbishment finishes, the residents receive new built houses depending on the ratio of their previous land. The process is as follows:

Setting up basic plan
(Public sector)
Designating refurbishing target
Setting up a committee
Setting up an association
Authorizing implementation
Authorizing management and disposal
Moving out & removal
(Implementation on actual owners)

Institutional conflict inducing corruption
The previous rules mandated that owners of land and structures that lack professional capabilities and funding set up a committee, and residents wishing to join the committee first tended to fall into conflicts with other groups of interest as they often intervened in the process.
Information about the work is exclusively limited to small groups such as association members
Information regarding refurbishment was exclusively provided to small groups of people such as committee members, which reduced trust on the overall work and increased the demand for a transparent process
Feasibility determination is made without knowledge on expected shares of expenses
Expense distribution was only revealed at the management and disposal plan establishment phase (about 4 years after initial of work), resulting in lawsuits among residents. Even if they want to change the course, costs and other structures already removed force them to eventually proceed with the work.
Considered as private work, public sector tends to be passive about the conflicts among residents
Refurbishment work was carried out by an association of landowners – in other words the private sector, so the public sector tended to be passive towards civil appeals. Public officials involved in the work treated such appeals as private ones or with a temporary solution without fundamental improvement, leaving management problems without a clear settlement.

Solution and Key Benefits

 What is the initiative about? (the solution)
Preventing civil conflict and corruption in early phases
Securing transparency by having the District office mayor manage the process for committee election has resolved conflicts among residents and prevented intervention of other groups of interest. The period, which generally took more than 2 years, also has been shortened to about 6 months and reduced the financial burdens of the residents.
Information disclosure management system (Clean-up system) for civil rights
Seoul government set up an information disclosure management system so that participating businesses will be able to reveal even monthly cost details. Periodic monitoring of its usage has now improved the information disclosure rate to 95% as of November 2011, which was less than 50% at system opening (January 2010), and there are now no appeals for information disclosure regarding refurbishment work.
Reasonable decision on work process through early disclosure of cost distribution
From June 1, 2011, the Seoul government has developed a program to determine and estimate the cost distribution for landowners and allow them to make decisions beforehand or simply if they agree with the work or not. Other regional governments are benchmarking the program in accordance with their own conditions.

Stable process by preview and reinforcing professional capability of public sector
Active administrative support such as previewing the work details without violating the rights of participating companies and managing information disclosure successfully has suppressed cost increases and work delays, protecting the assets of committee members and maintaining transparency.

Actors and Stakeholders

 Who proposed the solution, who implemented it and who were the stakeholders?
After analyzing performances of refurbishment work that the Seoul government has pursued for last 40 years, it has set up a consultation committee consisting of academic circles, civil groups, businesses and public officials, which recommended the expansion of public roles in June 2009. Officials of the Seoul housing center prepared concrete ideas and announced the introduction of the system, which then was put into force beginning July 16, 2010.

(a) Strategies

 Describe how and when the initiative was implemented by answering these questions
 a.      What were the strategies used to implement the initiative? In no more than 500 words, provide a summary of the main objectives and strategies of the initiative, how they were established and by whom.
The public management system was first drafted as of July 1, 2009 as the “Seoul Residential Environment Improvement Plan”. Its purpose was to protect the rights of all civil customers through transparency and improved efficiency, and the plan was put into action based on three strategies in spite of resistance from committee members and participating companies.
First, 25 self-ruling areas have been separated into 5 areas and public hearings, and briefing sessions and diverse types of discussions were held in each area to induce the empathy of civilians and public officials in those areas.
Second, a total of 12 visits were made to the national assembly and major authorities after legislation on July 13, 2009 for a stable process. Such efforts including individual meetings with congressmen resulted in a revision of the law as of April 15, 2010. The regulations were also finally revised as of July 15, 2010, despite strong resistance from construction companies, and were enacted from the following day.
Third, a transparent and shortened process by the District office mayor’s setting-up committee even before legislation started won civil consent that helped with overcoming the strong resistance from construction companies.

(b) Implementation

 b.      What were the key development and implementation steps and the chronology? No more than 500 words
In an effort to resolve corruption and civil conflicts that plagued refurbishment work for 40 years, Seoul government officials started to work on public refurbishment work based on the “Seoul Residential Environment Improvement Policy Plan” released on July 1, 2009.
Suggested by the consultation committee consisting of refurbishment professionals, the plan became concrete with Seoul officials
In April 2008, Seoul set up a consultation committee consisting of professionals from each field to analyze and resolve problems with old refurbishment work. After about a year of study, the committee stated their results and recommendations, based on which Seoul made the plans concrete.

Setting up civil empathy for public management including legislation and website for information disclosure
Upon announcing the “Seoul Residential Environment Improvement Policy Plan” on July 1, 2009, many hearings and briefing sessions were held, and the policy was completed. The policy consisted of an introductory business information disclosure system build-up, early shared cost estimate programs, and preparing standards for public management for each project.
The District office mayor announced support for setting up the committee for Seongsu Strategic Refurbishment Areas on July 1, 2009, which was completed as of October 27th of 2009 with active civil support.
Public hearings in 5 areas began in August 2009, while civil briefings, and staff training around the area throughout 2010 helped implement the system successfully.

On January 14, 2010, the information disclosure management system for guaranteeing civil rights (clean-up system for refurbishment) was opened to disclose business processes transparently, and on April 15, 2010, a revised legislative bill was announced as a legal basis, while the revision and standards were prepared for full implementation. An expense distribution estimate program has been in operation from June 1, 2011 following its introductory process.

(c) Overcoming Obstacles

 c.      What were the main obstacles encountered? How were they overcome? No more than 500 words
Obstacles such as strong resistance from established parties and negative opinions from internal members
Association members and construction companies attempted to hinder the implementation citing that too much intervention from public sectors shall interfere with civil autonomy. Officials who had to carry out public management felt overwhelmed with increased work and were passive at joining training sessions and submitting materials for setting up standards. But widespread support from civil sectors, completion of legislation, and the successes of introductory work led the opposing parties to understand the true meaning of protecting civil rights and interests, resulting in their affirmative acknowledgement and acceptance of the system.

(d) Use of Resources

 d.      What resources were used for the initiative and what were its key benefits? In no more than 500 words, specify what were the financial, technical and human resources’ costs associated with this initiative. Describe how resources were mobilized
Funding for operating costs and human resources for each step is required to avoid illegal intervention from interested companies, allowing participating companies to work on their own and manage the process themselves.
For this purpose, Seoul and other district governments have shared the costs for a committee set up, and it’s funding comes from Seoul’s budget directly.
As of September 1st, Seoul has newly opened the department of public management with 14 members for legislation and implementation. Each district also started a public management team with 3~5 members for support, reviews, such as company selection, and information disclosure management.

Sustainability and Transferability

  Is the initiative sustainable and transferable?
Demand for the expansion of the public role in refurbishment is steadily increasing. Standards for support are in accordance with the regulations of local governments allowing each area to operate the system based on their own situations. Also, the acknowledgement is spreading that that the system is not for protecting specific people’s rights, but all members of the community, while also improving transparency and efficiency to maximize sustainability.
At first, Seoul was the only government to put the public management system into effect, but on July 16, 2010, according to the revised law on April 15, 2010. Additionally, other governments including Gyeonggi-do, Incheon, Busan, Daedistrict, Ulsan and Gyeongsangnam-do are considering the implementation of similar systems. Gyeonggi-do has recently (October 2011) revised its regulations for implementation.

Lessons Learned

 What are the impact of your initiative and the lessons learned?
In particular, estimating the shared cost at early phases and determining feasibility dramatically increased the forecast for the residents. The information disclosure system allowed any civilian to find out transparent information on the refurbishment works increasing its trustworthiness. The public sector reviews the whole processes in advance for more transparency and efficiency and to reduce cost and delays from lawsuits. In the end, the perception that civilians are the true subjects in the process has led to active participation, such as offering opinions.
The implementation of the public management system has united civilians, parties of interest, and the government, and made civilians take part more actively with the idea that they are the true owners who can maximize the effects of the refurbishing works.

Contact Information

Institution Name:   Public Management Division, Seoul Metropolitan Government
Institution Type:   Government Department  
Contact Person:   Ok Kwang Youn
Title:   Public management of refurbishment work  
Telephone/ Fax:  
Institution's / Project's Website:  
Postal Code:  

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