SEOUL, Sept. 5 (Yonhap) -- The government and the ruling Democratic Party (DP) have started work on sorting out public institutions that will be relocated to provincial areas as part of a balanced regional development project.

Lee Hae-chan, the DP's chief, said in his parliamentary speech on Tuesday that his party will seek consultations with the government to designate regions that will host 122 public institutions subject to relocation under the special law on national balanced development.

His remark sparked an immediate dispute as critics claim that the government and the ruling party may seek the blanket relocation of state firms without consideration of the nature of their business.

Apparently to quell the row, the DP said that all 122 state-run companies will not be affected. Institutions including the Korea Development Bank (KDB) and Industrial Bank of Korea (IBK) will likely be excluded.

"It is impossible for some public institutions like banks to be relocated given the nature of their business," a ruling party official said. "Previously, the former Roh Moo-hyun government also did not consider the movement of the KDB and IBK."

The previous liberal Roh administration enacted the special law in 2004. Since then, the headquarters of 153 public institutions including power monopoly Korea Electric Power Corporation (KEPCO) have been moved to 10 "innovation cities" nationwide.

But the conservative administrations in power from February 2008 to May 2016 did not set up plans to relocate state firms.

The main opposition Liberty Korea Party (LKP) denounced the relocation move as "an attempt to devastate the capital."

"It is worrisome that Lee unilaterally presented a stance that decentralization is the best," Kim Sung-tae, the floor leader of the LKP, said.

Source: Yonhap News Agency