The news that Taoyuan county and city will be merged and upgraded to a special municipality is a cause for celebration as well as concern. It is a positive development because it will mean that urban development will speed up; it is a concern because given current fiscal problems, it is not clear where the extra funds for the upgrade will come from.
Taiwan, despite its size, has six main metropolises with a combined population of almost 16 million, 70 percent of the overall population. The remaining 30 percent are spread out over 16 counties covering 70 percent of Taiwan. Is this high level of urban concentration reasonable? With most resources and most of the population concentrated in six cities, the difference between urban and rural areas is likely to increase.
There are 47 top-level administrative divisions in Japan. Tokyo, a metropolitan district, and Kyoto and Osaka, urban prefectures, only make up 20 percent of the total population. In South Korea, there are eight provinces, one special city and six metropolitan cities, but these six cities only make up 46 percent of South Korea’s total population. Taiwan has six special municipalities and three of those, Taipei, New Taipei City (新北市) and the future Greater Taoyuan, are connected into one contiguous area. This situation must be quite unique in the world and is evidence of the severe imbalance of the nation’s administrative divisions.
The quest for an administrative upgrade among Taiwan’s local governments can be explained in two words: Money and power.
Special municipalities receive more from the Tax Redistribution Fund than counties and cities, and they are also allowed higher debt levels. Increasing the number of special municipalities will diminish the portion of the fund that goes to the 16 counties and cities, placing the special municipalities into an “A” team and the rest into a “B” team. The A team will get all the beef and the B team will be left with the bare bones, leaving them with a strong sense of deprivation, leading to political polarization.
Upgrading to a special municipality brings a budget increase and a larger bureaucracy with greatly increased salaries. However, as the central government’s budget remains unchanged, the additional expenditure will impact the already troubled fiscal situation.
Special municipalities compete with each other and with the counties and cities for funds. As the government enjoys less public support than the special municipality governments, the Cabinet will find it difficult to reject requests from local politicians ahead of elections.
The addition of a sixth special municipality is a foreseeable disaster. There are several issues that should have been addressed when there were only two special municipalities — Taipei and Kaohsiung — such as fiscal policy, administrative organization, administrative division, personnel issues and urban planning, and how they would be handled following the creation of new special municipalities. For political reasons, a wish to avoid problems and an unwillingness to relinquish control of resources, the government did not deal with these issues.
The problems that existed when there were only two special municipalities were compounded by problems created — but not dealt with — after the addition of New Taipei City, Greater Taichung and Greater Tainan. With the addition of yet another special municipality, further problems are likely.