There is something called “Special business expenses” which are used by the government. This money is usually provided to
government officials who carry out special tasks such as investigation,
inspection, budget plans and research.
Recently,
the issue of special business expenses has received spotlight through the
Constitutional Court chief justice nominee, Lee Dong-heub’s misappropriation of special business
expenses. Lee used this money, which is public money given to him for special tasks,
for personal purposes by keeping the money in his personal account and
investing it at financial market products. However, he insisted that he just
followed traditional practices and special business expense is used as personal
money in other institutions as well.
<2012-2013 Budget Plan for Special Business Expense>
(Unit: 1,000,000)
Institution |
2010 |
2011 |
2012 |
2013 |
Variation |
Board of Audit and Inspection |
3,049 |
3,496 |
3,605 |
3,926 |
▲ |
National Policy Agency |
424,704 |
435,989 |
440,042 |
443,381 |
▲ |
Ministry of Employment and Labor |
4,792 |
4,808 |
4,664 |
4,442 |
▼ |
Fair Trade Commission |
438 |
463 |
691 |
1,032 |
▲ |
Korea Customs Service |
9,479 |
9,670 |
10,302 |
10,631 |
▲ |
Ministry of Education, Science and |
153 |
170 |
89 |
63 |
▽ |
National Science & Technology |
0 |
0 |
61 |
62 |
△ |
Ministry of Patriots and Veterans |
15 |
15 |
15 |
16 |
△ |
National Human Rights Commission of |
215 |
215 |
247 |
248 |
△ |
Prime Minister’s Office |
608 |
581 |
503 |
482 |
▽ |
Anti-Corruption & Civil Rights Commission |
294 |
381 |
393 |
395 |
△ |
Ministry of National Defense |
7,705 |
7,928 |
11,046 |
10,802 |
▼ |
National Tax Service |
46,187 |
49,767 |
50,160 |
47,917 |
▼ |
Ministry of Land, Transport and |
224 |
224 |
210 |
250 |
△ |
National Assembly |
11,224 |
12,396 |
17,743 |
17,875 |
▲ |
Financial Services Commission |
106 |
106 |
106 |
108 |
△ |
Korea Metrological Administration |
17 |
17 |
18 |
19 |
△ |
Ministry of Strategy and Finance |
858 |
858 |
1,009 |
1,030 |
△ |
Ministry for Food, Agriculture, |
1,794 |
1,775 |
1,601 |
1,650 |
△ |
Rural Development Administration |
20 |
28 |
30 |
34 |
△ |
Supreme Court of Korea |
17,456 |
17,657 |
18,063 |
18,170 |
▲ |
Office of the President |
5,539 |
5,494 |
5,814 |
5,730 |
▽ |
Cultural Heritage Administration of |
22 |
22 |
22 |
22 |
ㅡ |
Ministry of Culture, Sports and |
54 |
55 |
80 |
82 |
△ |
The National Unification Advisory |
117 |
117 |
119 |
120 |
△ |
Korea Communications Commission |
212 |
212 |
257 |
258 |
△ |
Defense Acquisition Program |
94 |
94 |
96 |
90 |
▽ |
Ministry of Justice |
30,387 |
34,096 |
37,118 |
40,137 |
▲ |
Ministry of Government Legislation |
9 |
9 |
9 |
10 |
△ |
Military Manpower Administration |
19 |
19 |
39 |
67 |
△ |
Ministry of Health & Welfare |
256 |
42 |
42 |
44 |
△ |
Korea Forest Service |
332 |
350 |
352 |
340 |
▽ |
National Emergency Management Agency |
547 |
560 |
578 |
591 |
△ |
Korea Food & Drug Administration |
245 |
270 |
278 |
283 |
△ |
Ministry of Gender Equality & |
45 |
224 |
223 |
224 |
△ |
Ministry of Foreign Affairs and Trade |
14 |
14 |
14 |
15 |
△ |
Nuclear Safety and Security Commission |
0 |
0 |
11 |
33 |
△ |
Public Procurement Service |
1,001 |
1,028 |
1,071 |
1,085 |
△ |
Small & Medium Business |
19 |
19 |
21 |
22 |
△ |
National Election Commission |
857 |
1,315 |
1,325 |
1,385 |
△ |
Ministry of Knowledge and Economy |
156 |
162 |
162 |
162 |
ㅡ |
Truth and Reconciliation Commission |
277 |
0 |
0 |
0 |
ㅡ |
Statistics Korea |
3,120 |
3,120 |
3,098 |
3,049 |
▽ |
Ministry of Unification |
30 |
59 |
44 |
57 |
△ |
Office of Mister for Special Affairs |
342 |
342 |
342 |
313 |
▽ |
Korea Intellectual Property Office |
82 |
84 |
85 |
99 |
△ |
Korea Coast Guard |
29,045 |
32,123 |
33,372 |
33,613 |
▲ |
Ministry of Public Administration and |
743 |
855 |
914 |
848 |
▽ |
Multifunctional Administrative City |
10 |
10 |
14 |
12 |
▽ |
Constitutional Court of Korea |
1,040 |
1,040 |
1,065 |
1,082 |
△ |
Ministry of Environment |
140 |
133 |
144 |
139 |
▽ |
△ : Increased
less than 100 million / ▲ : Increased more than 100 million
▽ : Decreased less than 100 million
/ ▼ : Decreased more than 100 million
In
order to understand the current state of special business expenses, the Center
for Freedom of Information (CFOI) requested information disclosure to the
Ministry of Strategy and Finance with regard to each institution’s budget plan of special business expenses between
2010 and 2013.
The total budget allocated for
special business expenses in 2013 is 652.445 billion won. Sixty-eight percent
of the total budget, which is equivalent to 443.381 billion won, is allocated
to the National Police Agency followed by the National Tax Service, Ministry of
Justice and Korea Coast Guard.
Among 51 institutions that receive
the money for special tasks, it is 35 institutions that increased their budget compared
to 2012. More than 100 million won was increased on the budget plans of eight institutions
including the National Police Agency (△3.3 billion),
Ministry of Justice (△3 billion), Korea Coast guard (△240 million),
National Assembly (△130 million), Korea Customs Service (△320 million) and
Fair Trade Commission (△340 million). Remaining 27 institutions
also increased the budget ranging from a low of 1 million to a high of 60
million.
There
are only 16 institutions that the budget is same or reduced. The National Tax
Service showed the most dramatic decrease in its budget (▽ 2.24 billion)
followed by the Ministry of National Defense (▽240 million) and the Ministry of Employment and Labor (▽220 million). Other than this, the Office
of the President, Statistics Korea, Ministry of Public Administration and
Security, Prime Minister’s Office, Korea Forest Service, Office of
Minister for Special Affairs, Ministry of Environment, Defence Acquisition Program
Administration, Ministry of Education, Science and Technology and Multifunctional
Administrative City Construction Agency decreased their budget for special
business expenses ranging from a low of 2 million to a high of 84 million won.
The Ministry of Knowledge and Economy and Cultural Heritage Administration of
Korea kept their budget same.
<Source: EBS>
After the incident of Lee
Dong-heub, the Ministry of Strategy and Finance banned prepaying special
business expenses and notified each institution that special business expenses
more than 300,000 won a month should be paid with credit card keeping records the
reason and amount of the payment. However, potential of the misappropriation of special business
expenses still remains as there is no need to keep records for the cases under
300,000 won.
A
reform such as keeping receipts and records for every payment made is necessary
to prevent this. Otherwise, special business expenses can always turn into a blinded
tax.