Board of Audit and Inspection: "Government Grain Purchase Unlikely Subject to National Assembly's Prior Approval Requirement"

Audit Report on Agricultural Imports and Grain Purchases Released

The Board of Audit and Inspection has concluded that the government's grain purchase program is unlikely to be subject to the National Assembly's prior approval requirement.

On May 22, the Board of Audit and Inspection released the results of its audit on agricultural imports and grain purchases, stating that it is difficult to consider the Ministry of Agriculture, Food and Rural Affairs' practice of having NongHyup Agribusiness Group carry out rice market segregation and subsequently repay the principal and interest in installments as a violation of the National Finance Act.

Previously, the Democratic Party of Korea argued that the Ministry's project to purchase and settle grain in order to reduce the market supply of grain constitutes a "national treasury debt-incurring act." They claimed that failing to obtain prior approval from the National Assembly was a violation of the National Finance Act, and consequently, the National Assembly passed a request for an audit by the Board of Audit and Inspection at a plenary session at the end of last year.

The Board of Audit and Inspection explained, "In the case of rice market segregation carried out by the Ministry, it is only possible to review whether to implement it once the requirements for rice market segregation in the relevant year are met. Therefore, it is impossible to determine whether to undertake the act at the time of budget formulation in the previous year." The Board further judged that the specific purchase price the Ministry must pay to NongHyup Agribusiness Group is only finalized after the rice purchase is completed, so at the time of budget formulation, the repayment year and the exact amount of debt are unclear. For this reason, it is difficult to consider this a national treasury debt-incurring act under the National Finance Act.

The Board of Audit and Inspection stated, "If the matters that the National Assembly seeks to control in advance during the budget formulation stage have not been specified, it is difficult to regard this as a national treasury debt-incurring act as regulated by the National Finance Act," and concluded the National Assembly's audit request.

However, the Board identified some issues with the procedural validity of increasing the Tariff Rate Quota (TRQ) volume, as requested by the National Assembly, and issued institutional cautions to the Ministry of Agriculture, Food and Rural Affairs and the Ministry of Economy and Finance.

Yonhap News Agency

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