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NHIS under fire for lax management of employee loans
  • By Marian Chu
  • Published 2017.04.18 18:30
  • Updated 2017.04.19 18:25
  • comments 0

Koreans have long called state enterprises and public corporations “gods’ workplaces,” in reference to their fat paychecks and light workload; a recent auditory report of the National Health Insurance Service국민건강보험공단 has added one more reason.

According to the report made by in-house auditors, the state-run health insurance agency loaned out about 36.7 billion won ($32.1 million) to its employees in 2015 but has taken few, if any, measures to retrieve the money from those who failed to repay them as stipulated in lending contracts.

Under the policy of the state company operated with taxpayer money, employees who have worked for more than two years can get tuition loans (up to graduate school) for themselves or their children. Those who have worked for more than five years are eligible for various other loans that cover living fees such as disaster recovery, medical expenses, “cash gifts,” and house leases or purchases.

Auditors disclosed Monday that the NHIS mismanaged its loan program provided for employees.

When having to relocate personally because of a headquarter move, NHIS also provides 50 million won in loans to its employees, without charging any interest.

In theory, the public institution should have duly collected the principle repayment within a period. However, the audit found that lump sums were loaned out without due process, giving little incentives for employees to repay the principal.

The report revealed that employees borrowed around a total of 3.92 billion won for tuition fees. Also, 449 workers borrowed 18.5 billion won for relocation, and 1,088 borrowed 14.22 billion won for living costs. Compared with the 15.24 billion won lent out to 923 employees in 2013, NHIS loaned out a significantly higher amount of 32.84 billion won for 1,537 workers in 2015.

The problem is NHIS has taken no punitive measures for loan delinquents, according to the report.

The auditors called for reform regarding the management of NHIS employee loans, by notifying borrowers of repayment and taking all necessary measures for recollection. Officials have also ordered the company to thoroughly manage the loan system so that all principals are repaid properly through careful monitoring and regulation.


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