Expert audit looks at state programs

About half of the programs run on central government subsidies should be immediately scrapped or downsized due to little progress made and their inefficiency, a group of budget specialists said on Friday.

The group, which consists of 56 experts including professors or researchers, officially launched an audit into 1,422 government-run businesses and projects that operate solely on subsidies to determine whether they are worth continuing.

According to a report the specialists submitted on Friday to the Ministry of Strategy and Finance, only 51 percent of all projects are worth continuing as they currently are, while it was advised that the remaining half should be immediately halted or downsized.

The audit focused on pinpointing which projects could be run on government funding, which had shown little progress so far and which were overspending subsidies.

At 32 ministries and government-run organizations, 140 projects, or 10 percent of all programs, should be abolished immediately or gradually scrapped, the advisers said.

About 20 percent of projects should be gradually downsized, and 14 percent would be better off by changing the ways in which they operate.

The report projected that, on those recommendations, the central government could save about 1.8 trillion won ($1.5 billion) in budget expenditures by 2017.

One of the government programs the group recommended removing was one that offers living expenses for foreign employees with specialized skills working for small- or medium-sized companies (SMEs) in Korea.

The program, run by the Small and Medium Business Administration, spends about 22 trillion won annually. It offers up to 70 million won to each SME that hires a foreign professional with more than five years’ work experience and a bachelor’s degree who makes more than 30 million won annually on an E-3, E-7 or F-4 visa.

“The advisers said they found the program almost overlaps with another program run by the Trade Ministry,” a Finance Ministry official said. “And despite its high budget, there were few SMEs benefiting from the subsidies, so it would be better if it were abolished.”

A project run by the Ministry of Culture, Sports and Tourism to promote Korean food for the tourism industry also showed scant progress despite its 20 trillion won budget this year, the group said, adding that it should be gradually downsized.

The Finance Ministry will decide whether to accept the specialists’ advice at an upcoming review to plan next year’s budget, the ministry said.

BY KIMM HEE-JIN [kim.heejin@joongang.co.kr]