Gangseo-gu Saves 1.7 Billion Won Budget Through Contract Review

Creating a virtuous cycle effect by reinvesting saved funds into major pledged projects

Launch of cost analysis advisory meeting for budget savings this year, expecting budget reduction

[Asia Economy Reporter Park Jong-il] Gangseo-gu, Seoul (Mayor Kim Tae-woo) saved a total of 1.76 billion KRW in budget through contract cost reviews last year.

Contract reviews are a system that examines the appropriateness of cost estimates presented by the ordering department before bidding or contracting for a project, preventing budget waste factors in advance to help sound budget execution and strengthen financial soundness.

The review targets are construction projects over 20 million KRW, services over 10 million KRW, and goods over 5 million KRW based on estimated amounts. Over the past year, the district conducted contract reviews on a total of 790 cases worth about 73.1 billion KRW, including 304 construction projects, 234 service contracts, and 252 goods purchases, achieving a total budget saving of 1.76 billion KRW. The budget savings over the past three years amount to 5.67 billion KRW.

The saved budget is enough to support postpartum care costs (300,000 KRW) for about 5,800 postpartum mothers residing in Gangseo-gu under the newly launched “Gangseo-type Postpartum Care Cost Support Project” in the 8th local government administration.

The district plans to reinvest the significantly saved budget into major pledged projects.

In addition to contract reviews, the district produced and published a “Practical Manual for Cost Calculation with Case Studies” to strengthen financial soundness and employee capabilities. The manual organizes over 2,200 contract review cases from the past three years by category, covering four fields: construction, services, goods procurement, and design changes.

Furthermore, the district updated the “Pre-contract Review Checklist” summarizing essential items to check before contracting and the “Supervisor’s Construction Work Guide” containing mandatory inspection items from construction start to maintenance. It also operates an “Integrated Consultation Desk from Design to Completion” to assist project department staff in appropriate cost calculation, receiving favorable reviews.

This year, the practical first year of the 8th local government administration, the district newly formed and operates a “Budget Saving Cost Analysis Advisory Meeting” composed of external experts to enhance the professionalism of contract reviews and increase the budget saving effect.

Kim Tae-woo, Mayor of Gangseo-gu, stated, “This year, we will further strengthen the operation of the contract cost review system to enhance financial management soundness and prevent budget waste and leakage factors in advance. We will do our best to ensure that the saved budget returns as benefits that all residents can feel.”

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