Yoon: "Taxpayer Money Is Prey to Populism... Cartel Must Be Broken" (Comprehensive)

Yoon Presides Over Cabinet Meeting... Reviews Enforcement Decree to Strengthen Verification of National Subsidies
Criticizes Moon Government's Moral Hazard and Waste of Public Funds as "Fraud and Exploitation"
Orders Comprehensive Review of Subsidy Budget... "Thorough System Operation Required"

President Yoon Suk-yeol stated on the 13th, "The people's blood tax is becoming prey to popular populism," and emphasized, "The cartel of vested interests involving fraud and corruption must be dismantled." He particularly pointed out the moral hazard and tax revenue leakage that occurred during the previous administration as subsidies increased by 2 trillion won, and instructed relevant ministries to conduct a comprehensive review of the subsidy budget.

On the same day, President Yoon chaired a Cabinet meeting at the Yongsan Presidential Office, reviewing an enforcement decree focused on strengthening the verification of national treasury subsidies and stressed the establishment of measures to prevent financial leakage.

President Yoon Suk-yeol is delivering opening remarks at the Cabinet meeting held on the 13th at the Presidential Office in Yongsan, Seoul.
[Photo by Yonhap News]

“Enhancing the transparency of subsidies to non-profit private organizations” is one of the key national policy tasks of the Yoon Suk-yeol administration. The Yoon government announced last year, its first year in office, that it would strengthen supervision and transparently disclose the actual use and issues of subsidies to the public. President Yoon’s designation of the fraudulent use of subsidies as "an act of fraud against taxpayers" aligns with this context. He elaborated, saying, "It is an act of exploitation against future generations," and added, "It is the government's duty to immediately excise and correct what is wrong."

Above all, it was judged that during the previous Moon Jae-in administration, national treasury subsidies to private organizations surged by nearly 2 trillion won, but due to the lack of a proper management and supervision system, moral hazard and leakage of public funds became severe. President Yoon pointed out, "There were various forms of fraud such as embezzlement, rebates, false receipt, private use, and document manipulation," and criticized, "Subsidies were indiscriminately distributed, and verification and management were not conducted at all, creating fertile ground for fraud and corruption."

President Yoon particularly emphasized the need to "definitely dismantle" the "vested interest cartel." He added, "Even within the government, we must deeply reflect on whether management and supervision were properly conducted during the subsidy selection and execution process, or if it was carried out routinely due to complacency," and stated, "A thorough management and supervision system must be activated so that not only the project operators but also the responsible public officials can be held accountable."

Follow-up measures were also announced based on the results of a government-wide audit released earlier this month. This is a plan to improve the results of audits on national treasury subsidy projects for private organizations conducted over four months from January under the overall supervision of the Office for Government Policy Coordination across 29 ministries. The investigation revealed 1,865 cases of fraud and corruption in projects totaling 1.1 trillion won. The confirmed amount of fraudulent use alone was 31.4 billion won, and the government is preparing to recover subsidies, file criminal charges, and request investigations.

First, the Ministry of Economy and Finance decided to strengthen external verification of subsidy projects or indirect subsidy projects. The threshold for external verification of national treasury subsidy settlement reports will be lowered from projects over 300 million won to those over 100 million won to increase transparency and efficiency. Additionally, for national treasury subsidies, not only the primary recipient organizations but also subordinate organizations that receive consignment or re-consignment and actually execute the budget will be required to register in the national treasury subsidy management system, "e-Naradoom."

On the same day, President Yoon ordered detailed measures regarding the upcoming rainy season, stating, "The important thing is to prevent casualties. Strictly controlling access to dangerous areas and ensuring rapid evacuation from hazardous zones are most critical." He emphasized that disasters and calamities are harsher on the vulnerable and urged the prompt completion of the digital flood warning system, which he instructed relevant ministries to develop last year.