Opposition slams decision as politically motivated; Jeonju to get pension service instead


Jinju in South Gyeongsang Province has been selected as the sole location of the state-run Land and Housing Corp., the Ministry of Land, Transport and Maritime Affairs announced Friday.

The government had considered distributing the LH Corp. between Jinju and Jeonju in North Jeolla Province.

The decision will be finalized after the issue is reviewed by a relevant government committee next week.

The Land Ministry said that the decision was made as distributing the company between two cities was deemed detrimental to its operations. The ministry also said that dividing the company would also go against the reasoning behind its establishment as a single entity in 2009.

LH Corp. was established by merging the Korea National Housing Corp. and the Korea Land Corp. in 2009 to improve competence.

“It was judged that splitting headquarters would be detrimental to the company’s normalization and long term growth at a time when LH Corp. was suffering financial difficulties,” Vice Minister for Land, Water and Construction Jung Chang-soo said.

As of 2010, LH Corp. had more than 125 trillion won ($115 billion) debt.

With Jinju taking LH Corp., whose employees are about 1,500, the National Pension Service’s headquarters that had originally been slated for a move to South Gyeongsang Province will now be moved to Jeonju.

The decision was met by fierce criticism from the opposition Democratic Party for which the Jeolla Provinces forms its traditional support base.

Calling the decision a trampling of constitutional values of balanced development, the Democratic Party said that it was a ploy to appease residents of Gyeongsang Provinces who had been criticizing the government for its decision to scrap plans for a new airport in the region.

As the two state-run firms responsible for land and housing related projects that were combined to form LH Corp. were slated for relocation to Jinju and Jeonju, the opposition party had pushed for distributing the company between the two cities.

The relocation is a product of the former Roh Moo-hyun government’s controversial policy that calls for moving of state-run companies and institutes to other regions than the populous Seoul metropolitan area in the name of balanced regional development.

By Choi He-suk (cheesuk@heraldcorp.com)