Cases of improper use of government subsidies allocated to private projects related to North Korea human rights have been uncovered, raising the need for stricter oversight of subsidy management, officials said on the 17th.
The Ministry of Unification disclosed the results of its “2025 audit on the execution of government subsidies” on the 14th, stating that it had identified a case in which an organization carrying out a project to support North Korea human rights activities used part of its funds at a bar and ordered the recovery of $72.
Another organization was found to have paid project costs without undergoing a separate contract process while carrying out a service project exceeding $13,514, resulting in a warning. In another case, two organizations were found to have signed employment contracts with the same individual, leading to five instances of overlapping working hours during the same workdays, prompting a warning for duplicate wage payments.
The audit covered 59 organizations selected from five projects last year, including support for education of North Korean defector youth and assistance for families of wartime abductees. However, the Ministry of Unification does not conduct a full inspection of all organizations each year, instead selecting a sample, meaning the scope and targets of audits vary annually.
Issues surrounding the proper execution of subsidies have been repeatedly pointed out in previous audits. In the 2024 audit, cases were identified where insufficient review of performance reports and deliverables submitted after project completion led to warnings and fund recovery for unexecuted items. There were also instances where general administrative expenses exceeded the legal cap of 8%, resulting in reimbursement measures.
Additionally, a comprehensive audit of affiliated institutions under the Ministry of Unification last year uncovered multiple cases of improper budget execution. At institutions such as training centers, management offices and Hanawon, issues were raised over failure to reduce per diem allowances when using official taxis and improper payment and settlement of overseas business travel expenses, leading to reimbursement actions.
As repeated cases of improper execution have been identified among some organizations and institutions, there are growing calls to strengthen government oversight and management of subsidies related to human rights and broader projects involving North Korea. Concerns have also been raised that the current sample-based audit approach may not sufficiently ensure transparency across all projects.
Given the high policy sensitivity of such projects, transparency in budget execution is considered a key factor determining credibility. Accordingly, there are calls to reinforce not only post-audit measures but also pre-screening and continuous monitoring systems.
