The Ministry of Science and ICT has allocated project budgets worth 39.7 billion won over the past five years through the National IT Industry Promotion Agency (NIPA) without public calls for proposals.

Independent lawmaker Choi Hyuk-jin (최혁진), a member of the National Assembly's Science, ICT, Broadcasting and Communications Committee, said on Wednesday that his analysis of 자료 submitted by NIPA showed the ministry allocated a total of 39.7 billion won from 2022 through this year using a "policy designation" method in which it directly selects implementing organisations and funding amounts.

Annual policy-designated budgets were 8.53 billion won in 2022, 8.44 billion won in 2023, 6.44 billion won in 2024 and 5.21 billion won in 2025, before rising to 11.08 billion won this year, a 2.1-fold increase from a year earlier.

Under the policy-designation method, the ministry decides the implementing organisation and level of support and notifies NIPA, which then signs an agreement with the relevant organisation.

Choi said the approach could run counter to the open-competition principle under the National Research and Development Innovation Act. Article 9, Paragraph 4 of the law requires research and development organisations to be selected through open calls, allowing exceptions only in certain cases such as national security, designation under laws and regulations, or responses to urgent situations.

This year's policy-designated budget was allocated to 28 organisations, but the funds were concentrated in certain bodies. The AI Industry Convergence Business Group received 3.53 billion won, the Telecommunications Technology Association (TTA) received 2.53 billion won and the Korea Radio Promotion Association (RAPA) received 1.0 billion won. The 7.05 billion won allocated to the three accounted for 63.6 percent of the total.

In individual projects, most of the budget was also allocated to specific organisations. Of the 1.92 billion won total for the national AI data centre advancement project, 1.86 billion won, or 97 percent, went to the AI Industry Convergence Business Group. Of 1.57 billion won for the digital infrastructure diagnosis and improvement project, 1.49 billion won, or 95 percent, was designated for TTA.

In particular, for the "support for growth of competitive AI innovation talent" project, 1.25 billion won, or 96 percent, of the 1.3 billion won total was allocated to TTA alone without an open call.

Choi said, "There is no competition in a competitive project. This is the bare face of policy designation." He added, "Designation without an open call is allowed only exceptionally when it falls under reasons specified by law, but the ministry has made designations worth hundreds of millions of won every year for five years."

He added, "There were also 4 cases in which a single project was split and designated to 5 organisations," and said, "If there are this many organisations to carry it out, that in itself is a reason to hold an open call."

He also raised concerns that skipping open calls meant small and medium-sized enterprises, startups, universities and regional organisations did not even get a chance to participate in projects.

Choi said, "AI talent development, startups and support for overseas expansion are projects that SMEs and startups in the field are waiting for most desperately, but they are excluded without even an opportunity to submit a single application, and the same related organisations fill those slots every year." He added, "We need to examine whether this structure is becoming fertile ground for revolving-door bureaucracy."

Choi said he plans to use the parliamentary audit to check, with NIPA, the legal basis for each policy-designated project and the status of executives at beneficiary organisations who previously worked at the ministry or NIPA.

He urged, "Projects that do not fall under statutory exceptions should be switched to open calls from next year so that anyone can compete fairly."