Minister of the Interior and Safety Yoon Ho-jung reaffirmed on the 26th that the government's recent decision to put the brakes on Seoul Mayor Oh Se-hoon's signature "Hangang Bus" project amounts to "effectively a disapproval."

During a comprehensive audit of the Ministry of the Interior and Safety (MOIS) and related agencies by the National Assembly's Public Administration and Security Committee, Minister Yoon responded to related questioning by Democratic Party of Korea lawmaker Park Joo-min, stating, "Seoul City submitted a plan claiming it would reduce deficits, but the grounds were severely lacking and contained unreliable details, making approval impossible."

Previously, the MOIS Central Investment Review Committee held a meeting last month and sent an official letter requesting a re-examination of the investment review request submitted by Seoul City, in which the city proposed subsidizing 136 billion won in operational deficit losses to Hangang Bus Co., Ltd., the operator of the river bus service.

The official letter reportedly stated, "Regarding the 136 billion won in loss compensation, re-estimate the objective operational deficit by recalculating operation and ancillary facility revenues and costs based on objective grounds."

Local government central investment review is a system that reviews and evaluates the validity and necessity of budget allocations before local governments undertake investment projects above a certain scale. If a project fails to pass the investment review, it cannot be submitted to the city council for budget deliberation.

Regarding this, Mayor Oh Se-hoon emphasized during the Seoul Metropolitan Government audit held by the Public Administration and Security Committee on the 15th, "The number of (Hangang Bus) passengers is increasing steeply every month. If the current trend is maintained, I am confident of turning a profit within three years." However, the government's intervention has turned on a "red light" for the project.

Lawmaker Park pointed out, "The operating deficit of the project itself continues to grow. Seoul City claimed it would make up for this next year by doubling advertising revenue, but there are no details on how it plans to achieve that," adding, "Even the number of passengers listed in the investment review request is entirely inaccurate."

Park further stated, "Seoul City has traditionally resolved such issues by having the Seoul Housing & Communities Corporation (SH) provide loans or equity investments, and it will likely do so again this time," demanding, "The Minister of the Interior and Safety must prevent Seoul City from engaging in indirect and unlawful practices."

In response, Minister Yoon stated, "We will devise all available measures, including conducting audits."

When asked by Basic Income Party lawmaker Yong Hye-in, "Is there a means to sanction Seoul City if it does not comply with MOIS's disapproval decision?", Minister Yoon replied, "Since Seoul City is a non-allocation entity (which does not receive ordinary local allocation taxes), imposing disadvantages through the budget is difficult."

For local governments, "allocation tax penalties" are the government's only sanctioning tool, but because Seoul and Gyeonggi Province are classified as non-allocation entities, sanctions are practically impossible. It has also been pointed out that sanctions through Board of Audit and Inspection audits have limited effectiveness.

Regarding this, Minister Yoon stated, "It seems we need to devise other alternative measures," adding, "Methods such as pursuing disciplinary action against officials who fail to follow MOIS's instructions through audits could be considered."

Meanwhile, regarding Minister Yoon's remarks, Seoul City rebutted, "It is inappropriate to distort the request for re-examination—which stems from uncertainties in projected financial support estimates based on early operation results—as if the project itself has been disapproved."

The city added, "We plan to more objectively recalculate the size of financial support by re-estimating cost projections," and stated, "Based on this, we will consult with MOIS for a rational and prompt re-examination to ensure that the stability of the public transportation service already in operation is not compromised."

[ⓒ Global Economic Times. 무단전재-재배포 금지]