Board of Audit and Inspection: Ministry of Environment Signed Private Contracts and Overpaid Project Expenses to Associations Employing Retired Officials

Ministry of Environment Signs Private Contracts Worth 165.4 Billion Won with Associations Employing Retired Officials
Board of Audit and Inspection Uncovers 14 Cases of Misconduct, Including Overpayments and Unofficial Staff Dispatch

The Ministry of Environment has been found to have signed private contracts worth 165.4 billion won with affiliated associations employing retired ministry officials, while promoting 63 projects as privately commissioned initiatives. These associations overcharged project expenses, but the ministry failed to properly review settlement documents and made payments, resulting in budget waste.

On May 8, the Board of Audit and Inspection released its regular audit report on the Ministry of Environment, stating that it had identified 14 cases of illegal or improper conduct in areas such as the implementation of private consignment projects, management of environmental regulations, organizational and personnel operations, and water management policy formulation. The board issued warnings and notifications regarding these issues.

According to the report, from January 2021 to February last year, the Ministry of Environment outsourced 99 projects to two associations employing retired ministry staff over a four-year period, with 63 of these projects awarded through private contracts.

When calculating general administrative expenses for project execution, the associations included outsourcing service fees as part of the costs, resulting in an overestimation of more than 7.5 billion won above the appropriate amount over three years. In addition, they unjustly claimed about 1.5 billion won in personnel expenses for association executives and employees who did not participate in the projects, but the ministry still made the payments.

The ministry was also found to have operated environmental regulations based on internal departmental guidelines without undergoing prior regulatory review. The Ministry of Environment currently introduces and manages environmental regulations based on 79 laws. According to the Framework Act on Administrative Regulations, regulatory matters must be established through prior regulatory review by the Regulatory Reform Committee and stipulated in laws or similar regulations.

Furthermore, from 2018 to last year, the ministry unofficially accepted 185 staff members from 10 affiliated organizations and private groups without formal dispatch orders, and falsely reported that there were no unofficially dispatched employees.

The Board of Audit and Inspection explained, "We have notified the ministry to ensure that, when selecting institutions for private consignment projects, private contracts are not signed with specific associations when open competition is possible, and to establish measures to prevent excessive payments of general administrative and personnel expenses, thereby thoroughly managing related tasks."

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