[2022 National Audit] Retired Public Officials from Public Procurement Service Occupy Key Positions in Affiliated Organizations 'Increase in Order Amounts'

[Asia Economy (Daejeon) Reporter Jeong Il-woong] The reemployment of retired public officials from the Public Procurement Service (PPS) in affiliated organizations and the increase in service contract amounts awarded to these organizations have been pointed out as issues during the National Assembly audit.

According to data on the "Reemployment Status of Retired PPS Public Officials in Affiliated Organizations" and the "Service Performance Status of PPS Affiliated Organizations" provided by Jin Sun-mi, a member of the Planning and Finance Committee (Seoul Gangdong-gap), there are currently 18 retired PPS public officials working in four affiliated organizations registered with the PPS, of whom nine are confirmed to be serving as full-time executives with annual salaries in the hundred million KRW range.

The affiliated organization with the highest number of reemployed retired PPS officials is the Excellent Products Association, where seven individuals work as full-time vice presidents and directors of business and management.

Additionally, the Procurement Research Institute has five retired officials occupying key positions such as director, deputy director, and head of the management department; four are serving as directors of business and management and headquarters chiefs at the Korea MAS Association; and two hold director positions in business and management at the G-Pass Enterprise Association.

The previous ranks of the reemployed retired officials show that nine were Section Chiefs, the largest group, followed by two Deputy General Managers, four Deputy Directors, and three Managers.

The issue is that the scale of service contracts these affiliated organizations received from the PPS has increased significantly every year. According to Representative Jin, the total number of service contracts awarded to these organizations over the past five years (2018 to August this year) is 108, amounting to 16,388.69 million KRW. The contract amount, which was 2,208.62 million KRW (19 contracts) in 2018, doubled to 4,465.09 million KRW (22 contracts) last year.

By affiliated organization, the Procurement Research Institute accounted for the largest share of total contracts (2018 to August this year) at 10,537.30 million KRW (68 contracts), representing 64.3%. The MAS Association followed with 3,488.89 million KRW (7 contracts), the G-Pass Enterprise Association with 1,880.69 million KRW (24 contracts), and the Excellent Products Association with 433.31 million KRW (7 contracts).

In particular, the G-Pass Enterprise Association increased its service contracts from 137.81 million KRW (2 contracts) in 2018 to 524.20 million KRW (6 contracts) last year, a fourfold increase, and has carried out contracts totaling 947.80 million KRW (7 contracts) up to August this year, confirming a sevenfold increase.

Regarding the contract methods, negotiated contracts accounted for 87% (94 contracts) of the total. Among these, 67 contracts (62%) were negotiated contracts concluded after failing in competitive bidding. Conversely, contracts concluded through general competitive bidding, including restricted competition, accounted for only 13% (14 contracts).

Representative Jin stated, "The reemployment of retired PPS officials in key positions within PPS-affiliated organizations, which have a strong character as interest groups for procurement companies, raises concerns about undue influence in the PPS's entrusted tasks or service performance processes." She added, "The PPS should strictly review reemployment applications and establish institutional measures to block improper external pressure to dispel the controversy over 'gwanpia' (government officials exploiting their connections for private gain)."

This content was produced with the assistance of AI translation services.