“Financial Loss of Government-Raised Funds Reached 50 Trillion Won for 3 Yrs“

During the current regime, the amount of various governmental funds increased to 231 trillion won, three times larger than that of former government, exceeding two times of the national budget. However, the governmental funds sustained heavy losses of 50 trillion and 400 billion won for the past three years, indicating that the funds have been operated carelessly.

Rep. Lee Han-Gu (Grand National Party) maintained in the self-inspection data yesterday that " `an evaluation on the fund operation of the Ministry of Planning & Budget (MPB) in 2000 fiscal year` proved that the average point of the evaluated 57 funds was only 51.6 out of 100, and 44 funds marked under 60 points. The result indicated that various governmental funds have been very loosely operated."

The total asset of 44 funds marking under 60 points was 153 trillion and 900 billion won, occupying 46.7 percent of the asset of total funds (329 trillion 400 billion won). The governmental funds incurred the financial losses for the past three years as follows; ▲ Deposit Insurance Fund 51 trillion and 45 billion won, ▲ Fund To Liquidate Insolvent Bonds 4 trillion and 502.7 billion won, ▲ Public Official Pension Fund 4 trillion and 426.3 billion won, and ▲ Credit Guarantee Fund 3 trillion 172.6 billion won.

Rep. Lee also said, "A close examination on 31 funds conducted by the MPB discovered that 10 funds were incompatible to the purpose of fund establishment including the cultural industry promotion fund, 13 funds have been improperly operated, and 24 funds have been operated by the inappropriate fund operation policy."

And Rep. Lee stressed, "The amount of the governmental funds exceeded the double of the national finance, which is the sum of general budget and special budget, since 1998. The current government has used as the political tool various funds which do not need to receive the inspection of National Assembly. So, it is necessary to reform the fund operation system, for which the government should lessen the number of funds and should regularly announce the situation of fund operation to the nation."

Meanwhile, the Board of Audit and Inspection also found through the examination on the governmental funds that 5 funds including small & medium company foundation and promotion fund have been operated in a way incompatible to the purpose of fund establishment or were hard to collect the invested money.

Regarding this issue, an official of the MPB refuted, "According to the data of Rep. Lee, the total financial losses of 57 funds, 50 trillion and 400 billion won, were smaller than the financial loss only incurred from the deposit insurance fund, 51 trillion 45 billion won. It is an assertion that the absolute amount of losses was generated from the deposit insurance fund. But I could not understand on what basis Rep. Lee held such an assertion."

Jong-Koo Yoon jkmas@donga.com