Parliament to investigate rice subsidies scam

SEOUL, Oct. 20 (Yonhap) -- The National Assembly is to launch an independent
probe into a mounting scandal over ranking government officials' alleged
pilfering of state farming subsidies, officials said Monday.
Recent reports have revealed at least 500 billion won (US$384 million) in
government subsidies intended to support rice producers went to millions of
ineligible recipients -- including government officials and legislators -- over
the past four years, triggering widespread anger among the nation's farmers.
Adding to the growing suspicions, the audit board has been reluctant to disclose
the names of the illegal recipients, with their failure to do so precluding any
prosecutorial investigation.
"We have decided to accept the opposition's request to launch a parliamentary
investigation into the incident," a ruling party official said after attending a
closed-door meeting Monday.
The ruling Grand National Party, for the past week, has been refusing its
opponent's request to open a parliamentary investigation into the potentially
explosive corruption scam, claiming the issue does not qualify for an Assembly
probe and should be dealt with by legal authorities.
It faced more pressure over the weekend as the main opposition Democratic Party,
holding 83 seats in the 299-member parliament, threatened to boycott the
remaining Assembly sessions and break off cooperation in settling urgent bills
unless it cooperates in holding the parliamentary probe.
The rice farming subsidy system was established in 2005 under the Roh Moo-hyun
administration to support low-income farmers who protested the opening of the
Korean rice market to cheaper imports. Only those who actually produce rice --
excluding those who simply own rice paddies -- are eligible for the state
subsidies.
The ongoing case, which made headlines after the vice health minister was found
to have applied for the money despite her ineligibility, has grown into a
corruption scandal involving thousands of public servants, including at least
seven high-ranking officials and four legislators.
While the conservative ruling party blames the former government of failing to
address the errors in the subsidy system earlier on, opposition parties accuse
the incumbent administration of providing cover for officials who they say broke
the law.
Observers say officials and legislators who own land likely applied for the
subsidies in order to evade heavy property taxes rather than for the subsidies
themselves, and in the process inflicted financial losses on tenants who did the
actual farming.
Under the country's tax law, individuals must farm the land for at least eight
years to receive tax deductions on their property. As the government does not
require proof that applicants are actual farmers, non-farmers are able to abuse
the system.