[Anchor]
The problem is that the number of these citizen and provincial football clubs, which effectively survive on taxpayer money, is steadily increasing. That is not all. It is difficult to know where and how much of these subsidies are being spent, and the K League governing body, which is supposed to monitor this, is failing to fulfill its role.
Pyeon Gwanghyeon reports exclusively on this issue.
[Reporter]
Citizen and provincial football clubs, which emerged after the 2002 Korea-Japan World Cup to utilize infrastructure and develop the K League, have continuously grown in number since the introduction of the promotion and relegation system in the 2010s, increasing their proportion within the K League.
Over the past six years, they have increased at a rate of one team per year, eventually making up a majority of the league.
Many citizen and provincial clubs have been utilized as tools for local government authorities to pursue their own interests, lacking the motivation to pursue "self-reliant management." As a result, "local government subsidies" have been on an upward trend every year.
Despite massive amounts of "taxpayer money" being poured in, criticism has emerged that bookkeeping methods for subsidies are not standardized, making it difficult for citizens to examine the clubs' financial situations.
Club A classified 7 billion won out of the 8 billion won received from the city as "capital injection" added to its capital stock, making the subsidy appear to be only around 1 billion won. Meanwhile, Club B engaged in so-called "netting" by offsetting about 10 billion won in municipal funding against expenses, making it difficult to determine the scale of subsidies just by looking at the financial statements.
There are even clubs that do not disclose their financial statements at all.
[Official at Citizen Football Club C: Because of sales and things like that, we are not subject to public disclosure. (So there is no way for outsiders to see it?) Yes, that's correct.]
The monitoring by the K League, which manages and supervises club operations, is also lax.
While financial soundness is examined when screening the eligibility of new clubs, the barrier is so low that teams only need to avoid three consecutive years of net losses or complete capital impairment.
The criteria for existing clubs to maintain their qualifications are even lower. Simply put, a club just needs a balance of zero won or more, and even if it falls into complete capital impairment, it only needs to resolve it by 2030.
[Jung Do-jin, Professor of Business Administration at Chung-Ang University: This is a rock-bottom baseline that assumes subsidies will inevitably continue to be poured in endlessly.]
The K League stated that it will strengthen financial management,
[Cho Yeon-sang, Secretary General of the K League: As for more proactive systems we are considering, one is the salary cap. We are also devising roster systems to limit the number of players a squad can hold to a certain level.]
However, it did not give a clear answer on whether it would change the policy direction of continuously increasing the number of citizen and provincial clubs.
(Video reporting: Yang Du-won, Video editing: Park Ki-deok, Design: Byun Da-young, Kim Min-young)
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