Published : 2013-01-13 10:38
Updated : 2013-01-13 10:38
President-elect Park Geun-hye's transition team aims to keep public utility charges below gains in consumer prices to reflect the incoming administration's key policy goal of improving the livelihood of the people, sources said Sunday.
A source in the transition committee told Yonhap News Agency that it is right for hikes in utility prices be kept to a minimum so as not to adversely affect the economy and the lives of ordinary people.
"The goal is to encourage state-run utility companies to first streamline operations to cut back on waste and enhance operating efficiency before raising rates," said the insider, who declined to be identified. He said that utility corporations have been advised to come up with measures to reduce unnecessary spending and improve overall efficiency.
The move comes as independent experts said that calls for adjusting public charges have already been largely reflected making it unnecessary to further mark up fees.
They also said that under the incumbent Lee Myung-bak administration consumer prices rose 3.5 percent on average, but some utility charges have outpaced that.
Government data showed that in the past eight years, average gas and electricity rates rose 9.2 percent and 3.9 percent annually. In particular, electricity charges are expected to go up by 4 percent starting Monday, while plans have been announced to raise toll fees for highways built with private capital.
Reflecting the transition committee's stance, the government said it will set up a review system that thoroughly checks proposed hikes. Emphasis will be placed on reviewing accounting practices and debt management.
"Because of the sluggish economy every effort must be made to stabilize the livelihood of ordinary people and since public utility price gains can impact the public's spending and eat into income, adjusting charges must be kept in check," a government official said.
The Bank of Korea said Friday that this year's growth will likely reach 2.8 percent. This is a gain from the 2012 growth estimate in the lower 2 percent range, but is not as high as 3.6 percent growth tallied for 2011. (Yonhap News)