Despite the central government providing most of the subsidies for projects like the National Geopark initiative, instances of funds not being utilized at the project level are recurring. This is particularly evident in infrastructure projects requiring preliminary procedures such as land acquisition, design, and permits, where delays in project execution after budget allocation lead to significant carryover and waste.
According to the "2026 National Subsidy Project Extension Evaluation Report" submitted to the National Assembly by the Ministry of Strategy and Finance's Subsidy Project Evaluation Team on September 20, the initial allocation execution rate for the National Geopark project reached 99.9%. However, the actual spending rate fell short of this figure. Over the past three years, the weighted average actual execution rate based on allocated funds was recorded at 85.3%. The annual actual execution rates varied significantly, with 92.2% in 2023, 73.6% in 2024, and 93.2% in 2025.
Notably, delays in execution were pronounced in the capital subsidy project for the West Coast World Geopark Discovery Center. The total project cost is 5.415 billion won, with 500 million won allocated in 2024. However, due to delays in administrative procedures such as land acquisition and architectural planning, the actual expenditure was recorded at zero.
Nevertheless, 2.086 billion won has been allocated for the project in 2026. Following the settlement of the 2024 subsidy project, a remaining balance of 244 million won was noted, which corresponds to 26.5% of the allocated amount at that time.
The evaluation materials pointed out the significant gap between the initial allocation execution rate and the actual execution rate for the National Geopark project, highlighting the occurrence of large-scale carryover and waste. It emphasized the need for separate management of allocations and actual expenditures, suggesting a management system to verify whether project funds are being spent in accordance with the actual progress of the work.
Similar issues have been observed in local river maintenance projects, where the actual execution rates have remained between 74% and 82% over the past three years. The evaluation process also noted that some local governments, which failed to adequately utilize carryover funds from the previous year, continue to receive additional national funding.
The budget for local river maintenance projects in 2026 is set at 296.9 billion won, reflecting a 13.3% increase from the previous year. The evaluation materials indicated that while the maintenance and repair of rivers are crucial for national safety functions, there is a need to revise the existing allocation system and distribution criteria given the low actual execution rates.
Infrastructure projects inherently cannot be executed immediately upon budget allocation due to their nature. Actual expenditure on construction costs can only occur after completing preliminary procedures such as design, permits, land compensation, and community consultations. Delays in these processes can lead to postponed expenditures at the local government or project execution level, even after the central government has allocated subsidies.
Evaluations have confirmed that similar delays in administrative procedures during the planning stages of other facility projects have resulted in low actual execution rates. Consequently, some projects are subject to budget reductions in subsequent years if their actual execution rates fall below a certain threshold or if carryover occurs repeatedly.
The issue lies in the discrepancy between the central government's fiscal execution rate and the actual execution rate at the final project level. When the government allocates budgets to local governments, the central execution rate appears high, but if the actual project funds are not utilized on-site, the financial impact on the intended beneficiaries may be delayed. The economic stimulus effect of rapid fiscal execution may also be limited if actual expenditures do not follow.
This highlights the need to supplement the budget allocation criteria for government subsidy projects, moving beyond a simple focus on allocation rates to include actual feasibility and execution rates. In particular, for local governments or agencies with significant carryover from the previous year, the necessity and feasibility of new projects should be carefully evaluated.
* This article has been translated by AI.
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