Minister Lee So-young’s expertise and policy implementation skills put to the test... What to watch in the MSS audit: the Homeplus crisis and more

[Financial News] Minister Lee So-young of the Ministry of SMEs and Startups will face scrutiny over policy expertise and her ability to respond to current issues in her first parliamentary audit since taking office. As a lawmaker, Lee questioned the government on its policies at the National Assembly’s Trade, Industry, Energy, SMEs and Startups Committee. This time, she will take the respondent’s seat as the head of an agency under audit. Key MSS policies are expected to come under scrutiny, from aid for businesses affected by the Homeplus crisis to the effectiveness of Onnuri gift certificates and the Youth Startup Academy, whose planned abolition was reversed.
According to the National Assembly on the 6th, its Trade, Industry, Energy, SMEs and Startups Committee will conduct an audit of the MSS on the 7th. An audit of public institutions under the MSS will be held on the 15th of this month. It will be Lee’s first audit since taking office last month.
Support for tenant businesses and suppliers affected by the Homeplus crisis is expected to be a key issue. The government has put together a large-scale policy financing package, but the low rate of actual disbursement is expected to prompt questions about how effective the support measures are.
According to documents obtained by the office of Democratic Party of Korea lawmaker Kim Won-i from the MSS and Homeplus, the MSS set aside 140 billion won in policy financing to support Homeplus suppliers and tenant businesses from October last year through September 20 this year. However, just 31.2 billion won was actually disbursed, an execution rate of only 22%. Support reached 377 businesses, or 12.7% of the 2,968 suppliers and tenant businesses in total.
Ruling and opposition lawmakers are expected to closely question the MSS’s response to businesses affected by Homeplus and its plans for additional support. People Power Party lawmakers Park Seong-min and Woo Jae-joon requested that MBK Partners Chairman Kim Byung-ju appear as a witness, but Kim submitted a written explanation to the National Assembly for his absence.
The policy effectiveness of Onnuri gift certificates is also expected to come under scrutiny. From January through August this year, total transactions using the certificates amounted to 3.3369 trillion won. Of that, 73.7%, or 2.4592 trillion won, was spent at 22,581 merchants in the top 10% by transaction volume. Spending at merchants in the top 1% alone accounted for 37% of the total. With spending concentrated at a small number of stores despite the expansion of the merchant network, lawmakers are expected to ask how well the policy serves its stated aim of revitalizing traditional markets and neighborhood businesses.
Debate is also expected over the Youth Startup Academy, whose planned abolition was effectively reversed. The MSS initially proposed in its 2027 budget plan to convert the existing Youth Startup Academy program into the Rechallenge Success School, but startups founded by Academy alumni and others voiced continued opposition.
Lee recently said, “We have decided to find a way for the Youth Startup Academy to avoid abolition and continue its legacy,” effectively reconsidering the original policy. During the audit, lawmakers are expected to question the process that led the ministry to consider ending the program and why it changed course so soon afterward.
As small business owners face growing platform costs, including delivery-app commissions and advertising fees, the direction and effectiveness of the government’s planned cooperative delivery app are also key issues. Lawmakers are expected to examine how policy financing for small and medium-sized enterprises is being disbursed and whether it is being misused, as well as whether policy financing is reaching small and medium-sized businesses and small business owners struggling financially.
The opposition also plans to scrutinize the MSS’s support for Genencell, a pharmaceutical company embroiled in allegations of solicitation to secure approval for clinical trials of a COVID-19 treatment. People Power Party lawmaker Choi Su-jin plans to closely examine how Genencell received support through the MSS’s research and development (R&D) and startup-support programs, as well as the results achieved afterward.
A representative of the small and medium-sized business community said, “Given that Minister Lee has emphasized the need to resolve differences with other ministries since her time as a nominee, another point to watch is what solutions the minister will propose on issues involving multiple ministries, such as regulatory reform, finance and labor.”
[email protected] Kim Hyun-cheol Reporter