Back

Audit and Inspection on the Rural Welfare and Living Environment Improvement Projects

By Han Dae-Soo, Senior Auditor, Board of
Audit and Inspection, Republic of Korea

I.    Introduction

The Environment Improvement Project among Rural Development Projects in Korea is one of the projects playing the most important role in modernizing Korea's rural communities.

The poor and stagnant lives of rural people over thousands of years began to disappear since the later part of 1%0's, thanks to the Korean government's strong drive for the Modernization Policies of Rural Areas and the Economic Development Plans, and, hence, the rural people's fundamental problems of clothing and food were somewhat solved. The living environment, however, could not still be improved.

Accordingly, Korean government promoted Living Environment Improvement Project such as paving the inner roads of more than 33,000 villages which are the centers of the villages, and constructing drainages, by making the best use of the farming-idle winter period of 1971.

This was the initial stage of the Improvement Projects of Rural Living Environment in Korea.

The government, based on this experience, began to launch the Housing Improvement Project nation-wide from 1977 when the fundamental improvements of rural living environment could have been somewhat realized, and by doing so, the living standards of rural people could be improved and a foundation for constructing ideally modernized rural communities could be established.

The step-by-step implementations of diverse projects for improving rural living environment by government resulted in surprising achievements in rural welfare as well as in rural living standards.

Government, therefore, in addition to the basic Environment Improvement Projects, has changed its policies for the welfare of rural residents to meet their demands for civilized living by promoting public welfare projects such as the expansion of electrification, installation of telephones and operation of regular buslines of rural areas.

II.    Audit and Inspection on the Rural Welfare and Living Environment Improvement Project

1.    Necessity of Audit and Inspection

In the Rural Welfare and Living Environment Improvement Projects, more emphasis should be given to the spiritual aspects which Korean rural inhabitants receive from the projects rather than the quantitative aspects such as the number of government officers participating in projects and the scope of the projects' beneficiaries.

Since Rural Environment Improvement Projects were playing a role of a facilitator in rural modernization by reforming villagers' thinking from narrow-mindedness and passiveness into self-help, cooperation and diligence, what is most urgently required is. to prepare improvement measures timely whenever there are problems which reduce inhabitants' enthusiasm or bring about inconvenience to them, both of which can be revealed in implementing projects, and by doing so, to correct them.

2.    Selection of Projects and Methods of Audit and Inspection

The BAI, to fulfill a supportive role for the national development and to do its best to achieve the aims of national policies, establishes its operational directives. It also makes sufficient reviews on matters which each bureau and division takes charge in executing the same directives effectively. After that, the BAI selects the items to audit and inspect.

Projects selected to be audited and inspected are: projects that were implemented as major national policies and the securing of whose effects were critical; projects that demand effective use of national budget because the scales of the projects were very huge; and projects the effects of which gave great influences on increasing the benefit and convenience of people.

The audit and inspection focus at the initial stage of the Rural Welfare and Environment Improvement Projects between 1976 to 1979 was given mainly to the quantitative aspects as follows:

• Whether the target quantity of the projects was accomplished as planned;
• Whether various kinds of supportive funds were used appropriately for the original purposes;
• Whether the resulting achievements of the projects were correctly reported.

The focus of audit and inspection from 1980, however, has been changed to the qualitative and achieve mental aspects:

• Whether the project plans were rationally established;
• Whether the projects were selected without any violation of the basic principles;
• Whether the funds were utilised effectively;
• Whether the projects actually contributed to the welfare of the residents.

Changes in the focus of audit and inspection were towards the direction of efficiency of the audit and inspection,

3.    Audit and Inspection on Rural Housing Improvement Projects

Traditional houses in rural areas of Korea are located where farming-lands, water-supply and fuels can be easily secured. They are also constructed in convenient fashion for living, for example, houses stand toward the south. In terms of the arrangement of houses, each house is located separately while working spaces and living spaces are mixed. The interior space is so small that overall reconstruction or total new construction is absolutely needed.

The government began to initiate the first project of replacing the thatched-roofs, which should be changed every year, with slate or tiles. As a second stage, it began to execute the Rural Housing Improvement Projects for the houses in the areas which might be easily damaged by floods or landslides giving the first priority to the old and worn-out houses which must be replaced with newly built ones because of weak substructures.

The outcome of the projects were that 273,000 households among all the rural houses in poor conditions (48%) were reconstructed or repaired with 661.1 billion wons of project expenses invested until 1983.

Problems revealed in the course of implementing these projects at their initial stage can be enumerated as follows:

1. A lot of manpower and time as well as large amount of expenses were wasted because the projects were carried out without establishing a long-term plan. For example, in executing the Roof-Improvement Projects, the focus was given only to replacing the thatched-roofs with slate or tiles, and soon after that, the same old and worn-out houses with newly reformed roofs had to be replaced by newly-built ones through the Housing Improvement Projects.
2. The system to supply materials for improving roofs and houses at low prices was not established at the same time when the projects were commenced, and, hence, there were cases that poor-quality materials were purchased at higher prices, and therefore, the rural residents had to bear heavier financial burdens.
3. In implementing Rural Housing Improvement Projects, excessive enthusiasm to make higher quantitative achievements for a period brought on increase in debts to some farmers because they borrowed money from outside when they had no funds of their own.
4. There were cases wherein balanced development could not be achieved because the areas of these projects were not properly selected.

The BAI, to solve the problems explained so far, paid attention to the following contents as key items of audit and inspection. The emphasis by the BAI in order to conduct effective audit and inspection are:

• Whether the selection of target persons for whom Housing Improvement Projects would be carried out was made without violating basic principles.
• Whether the funds supplied were properly distributed and used;
• Whether the fund allocation and the project implementation were made properly enough to bring about a balanced regional development;
• Whether there were cases of improper administrative supports which increase the burden on farmers;
• Whether sufficient technical support was given. Results of audit and inspection are as follows:

1. The Improvement Project of poorly-conditioned house was carried out without any principle with the result that a balanced Rural Development could not be realized.
2. By giving the benefit of housing improvement to the houses along railway lines and main roads, poorly-conditioned houses that should be actually improved were excluded.
3. Wrong selections of grantees who would receive funds for their poor-conditioned houses and improper supplies of the funds.

Concrete cases that proper actions were taken against problems revealed in audit and inspection are as follows:

1. Regarding the cases where the Improvement Projects of Poorly-Conditioned houses were carried out with partial concentrations on some areas without considering the priority, the central planning authority, i.e., the Ministry of Home Affairs, was requested to analyze the overall states to carry out the projects focusing on such areas which required urgent action due to the landslide, for instance, and at the same time to take measures for a balanced regional development;
2. In cases where the funds for Housing Improvement Projects were inappropriately supplied, if the projects were completed, excessively supplied portions were to be collected, and if the projects were in the planning stage, the plans were demanded to be changed. Moreover, all cases similar to those above were requested to be surveyed so that such cases would never be repeated again. By doing so, preventive efforts were promoted.

4.    Audit and Inspection o/ the Community Resettlement Projects

Since the shapes of natural communities in rural areas of Korea have been founded through a long history in a natural pattern, roads within the villages and drainage and sanitary facilities remained unchanged, and, therefore, various kinds of demands followed by increased incomes of farmers could not be met. They also caused inconveniences to the rapidly changing daily lives in rural areas, and, became impeding factors in the development of villages and nearby communities.

The government, hence, promoted the structural improvement projects of communities as one of the measures for the development of rural areas in the future.

Exemplary improvement projects were initiated in 1976 in 10 villages. From 1979, in a more developmental way, community structures were improved according to several patterns which are regarded as suitable for the conditions and actual situations of the villages. The patterns are as follows:

1. The Whole villages were moved into new areas if the villages were located in the areas habitually damaged by flood;
2. Some poorly-conditioned houses are transformed, improved or repaired while rearranging the roads or communit; common facilities within the villages;
3. In the village where most houses where in comparatively good state, poorly-conditioned houses were reconstructed by shifting their locations while maintaining already existing facilities in good state.

The projects have been promoted to give first priority to the areas in which living was very inconvenient. Funds invested until 1983 amounted to 148.7 billion won, and the target villages of these projects reached to 3,147 in number.

General evaluations on the achievements realized from these projects were:

• Agricultural production base were completed through the rearrangement of farming lands and the electrification, and the mechanization of farming was accelerated by utilizing the tillers.
• Desire for a civilized life accompanied by income increasing could be satisfied.
• By constructing the villages' common facilities including Community Centers and Community Warehouses, the individually spread rural villages were developed into cooperative working systems, and by doing so, a firm foundation for modernizing rural areas was laid.

Problems which generally occurred in promoting the Community Resettlement Projects are:

1. Funds supported by the government toward the target villages of Community Structure Improvement Projects were not sufficient so that every farm household had to bear a significant financial burden in implementing the projects.
2. Measures to purchase good-quality construction materials in bulk at lower prices not taken, and, therefore, farmers had to suffer poor-quality construction or economic loss was caused by purchasing the materials at higher prices.
3. Sufficient technical guidance was not given for design and construction and, therefore, it resulted in poor or crude constructions.
4. Due to wrong selection of the target villages or areas of the projects, the original goals could not be achieved and the funds provided in the budget were wasted.

To find out ways to solve several problems revealed in implementing the projects through audit and inspection, the BAI paid keen attention to the following contents:

• Whether the target villages were selected in accordance with the basic principle.
• Whether the projects were promoted in a balanced way for each region.
• Whether the supportive funds were allocated equally.
• Whether there are cases of negligence in administrative supports impeding the achievement of the project goals.
• Whether the project achievement was enhanced by sufficient technical support and by preventing poor and crude constructions.

Results of audit and inspection are as follows:

1. Projects were under implementation in the areas inappropriately selected disregarding the project norms.
2. Regardless of the standard amount of the project-supporting funds established, the project expenses were provided unequally among villages.
3. Residents had to bear a financial burden because the project executing authorities did not appoint the gathering sources of pebbles which are construction materials.
4. Careless selection of the project target areas caused rather inconveniences to the villages concerned.

Corrective measures taken against the problems found out from the results of audit and inspection are:

1. In regard to the point that a regionally balanced development could not be realized by executing the projects with a partial concentration on certain areas while disregarding the project plans, the authority concerned, that is, the Ministry of Home Affairs, was requested to study alternative measures to prevent repeated occurances of such cases by making nation-wide survey and by readjusting the annual plans according to the survey result.
2. In regard to the item that the project expenses were unequally supported, the Ministry of Home Affairs was requested to prepare proper alternatives including the additional supports of the project expenses to the villages that received insufficient financial aid, and at the same time, to supply the project expenses according to the basic principles.
3. As regards the finding that farmers' financial burdens became heavier because proper administrative actions were neglected, a nation-wide survey was conducted. For villages where the gathering sources of basic construction material were not secured, the sources of material collecting were determined. Such measures were taken in the order to reduce farmers' economic burden.
4. With reference to the point that new community areas were selected for the target villages of Community Structure Improvement Projects, the authorities related were requested to consider sufficiently about the surrounding conditions of the villages in order not to give damages to the residents.

5.    Audit and Inspection of Electrification and Telephone Installment Projects in Rural Areas

Electrification Projects of rural villages were commenced in 1965 and continued for 14 years until 1979 when the same projects were completed as all the houses except those scattered in inner lands, in remote mountainous areas, and in isolated island areas were electrified.

Not only in the aspects of living, but also in farming, electricity enabled scientific farming with proper facilities or through developing electricity-installed tube-well and could contribute to the increase of farm income. Thus electrification accelerated rural developments.

On the other hand, projects to install telephones at rural villages throughout the .nation were promoted. In 1978 all villages including legally established "Yees" and "Dongs" could communicate by phone. In 1981, even administrative "Yees" and "Dongs" of 37,146 village units could have telephones installed, and therefore, a swift communication network stretching out the whole country could be constructed. From 1982, direct dialing telephones between villages could be installed, and then a civilized living in a true sense could be led.

Problems which occurred in promoting such projects are:

1. The project quantity already planned by years and the additional plans attached did not mutually correspond, causing a fiasco in achieving the original aims.
2. Budgets for various constructions and for purchasing goods in the implementing projects were wasted. In solving such problems through audit and inspection, the BAI paid attention to the following contents:

• Whether the project plans by years were realistically established;
• Whether the expansion of the project quantity and several facility construction projects followed were under implementation in a mutually connected way;
• Whether the project implementation was delayed due to insufficient administrative supports;
• Whether the goods purchasing were properly executed without any waste of budget in carrying out various construction works.

The BAI, by revealing problems in promoting the projects through audit and inspection, focused on the items mentioned above, and by suggesting corrective measures, played a supportive role for the projects to be promoted as planned.

Results of audit inspection are as follows:

1. The construction completion periods of both telephone wires and telephone operating boards were not the same, which gave inconveniences to the users.
2. During implementing the projects the original basic plans were executed without reviewing and readjusting if necessary, and by doing so, budget was wasted.
3. The materials required for rural Electrification Projects were incorrectly estimated. This resulted not only in budget waste but also in economic loss for the electricity users.

Against the results of audit and inspection, the following actions were taken:

1. With reference to the finding that telephone installation projects could not be completed because plans on the affiliated facilities were not reviewed in the promoting process of the projects, the BAI requested the authority concerned, the Ministry of Communication, to conduct a nation-wide survey on actual states and to complement the insufficient aspects, and by doing so, to take actions in order not to give inconveniences to the rural inhabitants due to the delay of the construction completion.
2. In regard to the observations that the budget was wasted by correcting and executing the original plans in the promoting stage of the projects without a sufficient review, the BAI requested the authority concerned to implement the projects with no economic loss by referring sufficiently related documents and data when the plans would be changed.
3. The BAI requested the authority concerned to implement the projects after estimating the quantity of various construction materials necessary was clearly through a sufficient preliminary survey, and by doing so, the project aims could be accomplished with the least expenses.

6.    Audit and Inspection on the Water Supply and Sanitation Projects

Water from wells or natural water has been used for drinking in rural areas from old times. Drinking water sources such as wells or natural water are easily contaminated due to the environmental changes around those sources and, hence, infectious diseases by water broke out frequently and caused severe damages to the health of the rural residents, and as an accompanied problem, efforts and time were wasted because water had to be carried to the kitchen from the water source. Accordingly Korean government has exerted great efforts to solve the drinking water problem which is the most important one for health and sanitation.

This project has been promoted as one of the fundamental projects from the initial stage of the Saemaul Undong, resulting in a successful achievement that sanitized drinking water could be supplied to more than 8.36 million inhabitants of villages so far throughout the nation.

Problems which occurred in the implementing Simplified Water-Supply Facility Constructions are:

1. There were cases that confusions had arisen in promoting the projects since the authorities in charge of the project implementation were dualized: Ministry of Health and Social Affairs takes care of people's health; and the Ministry of Home Affairs deals with the matters related to Saemaul Undong;
2. There were cases that, in selecting the location of the water supply facilities, the most fundamental and principal condition in its selection was neglected, and, as a result, such facilities could not be used after the facility was completed.
3. There were cases that the follow-up management on several facilities after the completion of the facility construction was neglected, and that the drinking water sources became contaminated.

The BAI conducted audit and inspection on the problems enumerated above and requested to study alternatives and take action. The items on which the BAI paid attention during auditing and inspecting are:

1. Whether the target areas of the construction were selected after reviewing sufficiently the village conditions and the degree of necessity for the facilities;
2. Whether the water quality test in the areas where construction would be commenced was conducted, and whether the facilities were constructed based on the results of the test;
3. Whether the completely constructed facilities were contributed to supplying sanitary water to the residents through a proper follow-up management;
4. Whether the project funds were supplied to each village according to the principles.

Results of audit and inspection are as follows:

1. Important materials for simplified water supply facilities were not comprehensively procured by the central authority, which resulted in purchasing poor- quality materials at higher prices.
2. Due to the neglect of basic survey and water quality management of simplified water supply facilities, water could not be supplied normally.
3. Follow-up management on the completed simplified water supply facilities such as repair work was not properly conducted and the facilities could not be fully utilized.
4. Grains, which were supposed to be supplied to the residents who were mobilized for constructing the simplified water supply facilities, were sold out and used as construction expenses.

Against the results of audit and inspection so far reviewed, the BAl requested the authorities concerned and Province and counties who were directly executing and promoting the projects to establish alternatives and to take proper measures like following:

1. For the problems of purchasing poor-quality construction materials at higher prices in the simplified water supply facility projects since individual village had to purchase them, the BAI requested the Ministry of Home Affairs as well as Cities and Counties to establish proper improvement measures, so that the budget waste and farmers' economic burdens would be lessened;
2. The BAI ordered the related authorities to examine all the facilities which could not be used, due to the negligence in maintaining and managing the protection of water sources among all the completely constructed simplified water supply facilities, and to dismantle such facilities that could not be utilized any more.

The BAI also requested them to conduct a thorough survey on all the facilities that the water quality of which was found out harmful to human body due to incorrect water quality tests before their construction and that the source of water which was expected to be unsuitable for drinking since the surrounding environments of the present facilities were contaminated. The BAI demanded to give the judgement on whether the facilities could be used or not.

3. The BAI requested the authorities to educate the residents to manage thoroughly the simplified drinking water facilities now being used everyday.

III.    Conclusion

The Rural Welfare and Living Environment Improvement Projects, since they are one of the most important national projects in order to realize the rapid modernization of Korea's rural areas, should be continuously promoted.

Various kinds of projects under implementation at present would be continuously expanded by promoting them with annual plans and aims. Authorities concerned including the Ministry of Home Affairs would continuously exploit and implement new projects for the increase of welfare of the rural residents.

Consequently, audit and inspection on these fields also should be conducted in various ways according to the directions in which the same projects would be executed. For all the projects now already planned and being executed, audit and inspection should be conducted regularly, and problems revealed from audit and inspection in each field should be corrected, improved and complemented by central planning authorities concerned like the Ministry of Home Affairs, and by doing so, the effects of the projects should be maximized.

In cases where new projects are to be selected and implemented, a systematic audit and inspection should be conducted from the earlier stage, in other words, from the planning and executing phases of the projects including the on-the-spot audit and inspection. Preventive and guide functions of audit and inspection would be strengthened in order to avoid the waste of manpower and budgets through correcting, complementing and improving the plans if there is any inconsistency.

In the audit and inspection methods, comparative methods now employed should be studied and developed in such a way that improvement measures are prepared through comparing good items and incorrect aspects of the projects that are promoted among regions.

Especially in case of Rural Welfare and Living Environment Improvement Projects, questionnaire survey should be fully employed to listen extensively to the achievements and problems of the same projects that are carried out for rural people who are direct beneficiaries of the projects, and the results should be reflected on the analysis and establishment of improved alternatives. By doing so, efforts should be concentrated on improving the projects.

Also, scientific audit and inspection techniques, such as audit and inspection methods of measuring efficiency and effectiveness, should be steadily studied and developed to conduct audit and inspection on the implementation of the projects on a higher dimension. Such abilities to conduct audit and inspection scientifically should be cultivated by mutual exchange of audit and inspection techniques, experiences and information among the ASOSAI member countries.