From heroes to hypocrites

A university professor disclosed a detailed description of the status of lobbying by giant construction firms eager to win bids for new public buildings.

The construction sector, it seems from this report, is truly hypocritical. Our construction companies were once regarded as heroes that changed an unplanted desert into an Eden with abundant woods and some of the world’s best state-of-the-art buildings. We were mightily impressed at the transformation.

However, one cannot help but criticize them now after taking a peak at the domestic situation. According to a report by the Citizens’ Coalition for Economic Justice on corruption over the past 12 years, more than 50 percent of the total number of bribery cases in which judicial punishment was handed down involved construction companies. It seems that there is plenty of meat behind the general idea that the construction industry is a hotbed of corruption.

Korea’s construction sector currently represents 17 percent of the country’s gross domestic product and 8 percent of its total workforce. We can’t leave the sector unattended, especially considering its integral role to the nation’s prosperity. It is true that the government launched several institutions and policies to address these challenging issues. It amended the Framework Act on the Construction Industry to ensure that corrupt firms are punished with one-year suspensions. However, corruption cases keep mounting.

Construction companies are still not afraid to take risks when it comes to lobbying. If their efforts are successful, they can earn hundreds of billions of won (hundreds of millions of dollars) in new contracts. In comparison, the fines of hundreds of millions of won they face seem paltry and do little to deter these firms.

We now need to ponder how many companies have been sentenced to a one-year suspension of business. We need to pay more attention to the comments of a representative of a construction consulting firm, who recently said that the “construction process, including the order process, should be overhauled across the board to eradicate corruption altogether.”

That would then help lower costs incurred for private and public construction by more than 20 percent, which will also lead to lower-priced apartments.

Japan was ridiculed as a “construction-led nation.” However, the Japanese government has mercilessly dealt with construction scandals. As a result, Japanese builders exercised self-restraint in lobbying and succeeded in lowering construction costs by nearly 30 percent by eliminating waste.

The authorities here should promptly embark on an investigation into these corruption cases. Construction firms involved in repetitive scandals should be shoved out of the market for good. We should strengthen institutional measures to ensure that the gains from lobbying will be redeemed severalfold. This is the only way of facilitating consumers’ well-being and ensuring the survival of sound and capable builders.