According to Article 1(1) of the National Gambling Control Commission Act, the gaming industry encompasses casino businesses, horse racing, bicycle and motorboat racing, lottery tickets, and sports promotion betting tickets. The public gaming industry is operated by public institutions under applicable laws. Examples include Kangwon Land (the only casino that accepts Koreans as well as foreigners), bicycle and motorboat racing/sports promotion betting tickets (operated by KSPO), horse racing (operated by Korea Racing Authority), and lottery tickets (operated by the Korea Lottery Commission under the umbrella of the Ministry of Strategy and Finance). In 2011, the industry's total revenue was approximately USD 17 billion, horse racing being the largest contributor (USD 7.4 billion), followed by lottery tickets (USD 3.6 billion), bicycle racing (USD 2.4 billion), sports promotion betting tickets (USD 1.7 billion), Kangwon Land (USD 1.1 billion), and boat racing (USD 0.7 billion). Furthermore, the domestic gaming industry created tax revenue of about USD 2 billion and relevant funds of about USD 2.2 billion. Despite this growth, the overall size of the industry's  business, management status, and the distribution and use of earnings have not been properly evaluated.

    In this context, the National Assembly Budget Office published a report, Evaluating the Public Gaming Industry. The report provides an evaluation of the supervision of the industry and the use of earnings, and suggests some legal, institutional, and budgetary/accounting measures for improving the current system, such as securing supervisory independence and raising the effectiveness of the integrated regulation.
    Regarding the supervisory system, the report can be summarized as follows: First, the National Gambling Control Commission is implementing strong supply-regulation policies including gross volume control, the introduction of electronic cards, and the reduction of the share of revenue from off-track betting offices. However, even if gaming business operators fail to adhere to such policies, the Commission has no authority to enforce them but can simply provide a "recommendation," which weakens policy effectiveness. Second, the Commission lacks organizational independence because most of its staff consists of those dispatched from the ministries that are related to the gaming industry. Moreover, Vice Ministers of the competent ministries become ex officio members of the Commission, and those recommended by heads of such ministries are additionally included as the Commission members. Thus, it is hard to ensure fairness in the decision-making process. Third, even though the gaming industry has grown rapidly during the past 10 years and the prevalence rate of gambling addiction in Korea is several times higher than that of other economically advanced countries, the system of preventing and treating gambling addiction has yet to be well established.

    As to the distribution and use of earnings, the report provides the following evaluations: First, the use of the special reserve and the public business reserve prepared by the competent ministries lacks efficiency and is against the principle of the comprehensiveness of the budget under the National Finance Act. Therefore, the special reserve should be managed through a relevant fund. Second, the Korea Racing Authority and Kangwon Land have such problems as excessive reserves for business expansion and improper new investments. Thus, improvement measures should be considered, which includes reinforcing supervision by the competent ministries and designating Kangwon Land as a quasi-commercial public institution. Third, given that finance in the sports sector depends on the revenue of the gaming industry, such as sports promotion betting tickets and bicycle/motorboat racing, measures such as expanding the general account budget and finding alternative financial sources are needed. Fourth, the existing allocation ratio of lottery revenue is based on the market share in 1999 when lottery institutions were integrated, and does not take into account priorities in terms of the operation of national finance. Therefore, the allocation ratio of all the earnings should be reviewed from the ground up and a relevant "sunset" regulation should be introduced.