Lee, Sohn fail to bridge gap on FTA

President, opposition leader disagree on timing, extent of college tuition cuts


President Lee Myung-bak on Monday declined main opposition leader Sohn Hak-kyu’s request for a revised supplementary budget bill, citing the proposal’s failure to meet legal conditions.

The Democratic Party leader called for more government spending to help cut college tuition, create jobs, recoup damages from typhoons and burials of livestock culled due to a foot-and-mouth disease outbreak early this year.

Lee and Sohn agreed on the need to draw up measures to reduce household debt, prevent further insolvency of mutual savings banks and create jobs, but could not bridge the gap on the pending free trade agreement between Korea and the United States.

Lee and Sohn also failed to agree on the timing and the extent of the proposed college tuition cut, and how the government should achieve it, Lee’s top aide for public relations Kim Du-woo said.

“The DP hopes to cut college tuition by half next year, but Rep. Sohn did not mention any specific amount of budget required to help universities cut tuition fees,” Kim told reporters.

The presidential office has confirmed its position that college tuition can be cut only after insolvent universities are restructured. Nearly 90 percent of Korean high school graduates go to college but many universities are struggling to make ends meet.

Lee and Sohn agreed on the need to induce incompetent colleges to restructure themselves or shut down. Under the current law, when a private school foundation is liquidated, it must hand over remaining property to another school foundation or revert it to the national treasury. There is a bill pending in the National Assembly to allow college founders to take a portion of their schools’ property upon liquidation. The bill is aimed at inducing them to shut down financially troubled schools.

As for the Korea-U.S. FTA, signed four years ago but yet to be ratified by the parliaments of both countries, DP’s Sohn refused to budge.

Lee reiterated his request for the DP’s cooperation, but Sohn insisted that a renegotiation was necessary. The current version, revised under the Lee administration and currently sitting in the National Assembly, serves the interests of the U.S. much more than it does Korea’s, Sohn said.

Despite agreeing to take steps to prevent the recurrence of the secondary savings banks’ insolvency, Lee and Sohn were unable to come up with detailed plans to compensate the victims of Busan Mutual Savings Bank, which was suspended earlier this year.

The government and political parties simply agreed to fully cooperate with the ongoing prosecutorial probe and a parliamentary fact-finding investigation into the corruption scandal involving savings banks and high-profile officials.

Lee and Sohn also shared the view that the public sector should take lead in creating more jobs, which was the best welfare policy, Kim said.

By Kim So-hyun (sophie@heraldcorp.com)