Kyungsillyeon "Number of Former LH Officials Recruited as Lobbyists Increased by 46 in 2 Years"

Serious Overconcentration of Orders by Firms Hiring Former Officials

An analysis by a civic group revealed that the number of former Korea Land and Housing Corporation (LH) officials hired by construction companies has increased by 46 over the past two years.

[Image source=Yonhap News]

On the 14th, the Citizens' Coalition for Economic Justice (CCEJ) held a press conference at the CCEJ auditorium in Jongno-gu, Seoul, to disclose the results of this analysis.

According to CCEJ, a total of 60 companies hired 142 former LH officials this year. This is an increase of 46 compared to 71 companies and 95 officials two years ago.

Companies that hired former LH officials won 69 out of 112 construction project management service contracts issued by LH from January to June, accounting for 61.6%.

In particular, companies that hired former officials participated as lead companies, joint performers, or shared performers in the top 1 to 23 projects by contract amount.

Additionally, an analysis of the status of bidders for 103 projects selected through general competitive bidding revealed that only two consortiums participated in bidding for 72 projects (70%).

CCEJ pointed out, "In a fiercely competitive service market, the fact that only two companies participated in bidding for over 70% of the projects strongly indicates signs of bid rigging."

For design service contracts, consortia including former official companies won 68 out of 95 contracts (71.5%) during the same period.

CCEJ explained, "Companies selected through public contests can secure detailed design services through private contracts, making former official hiring companies major targets for winning contracts. It is highly likely that these companies are focusing their bids on design contest methods with this in mind."

These results were derived by comparing and analyzing the 2023 LH former official hiring company status obtained through the Korea NGO Newspaper and the contract status of construction and service projects issued from January last year to June this year.

CCEJ pointed out that the reason for the monopolization of contract awards by former official hiring companies lies in the evaluation method called the comprehensive review bidding system for service projects.

CCEJ explained, "The comprehensive review bidding system encourages lobbying of evaluators to obtain high technical scores. Once evaluation scores are assigned, a forced differential scoring system is applied according to ranking."

CCEJ emphasized, "The LH innovation plans announced several times by the Ministry of Land, Infrastructure and Transport are merely flawed temporary measures that do not address the root cause. Eradicating preferential treatment for former LH officials must come first."

To resolve these issues, CCEJ stated the need for ▲ institutionalizing the CCEJ's top 10 citizen proposals ▲ immediate abolition of the weighted method, an unfair method for deciding successful bidders ▲ permanent operation of a presidential special committee to eradicate preferential treatment for former officials.

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