A scholarship foundation set up by the late father and president of the ruling Saenuri party's presidential hopeful Park Geun-hye decades ago has surfaced as a major political issue ahead of December's presidential polls.

The Jeongsu Scholarship Foundation was set up by late President Park Chung-hee in 1962, a year after he seized power in a military coup. Critics argue that the foundation came into being only with assets "looted" from a Busan businessman who fell out of favor with the then military junta led by Maj. Gen. Park Chung-hee who later became president.

The foundation has since grown to wholly own a newspaper in Busan, the nation's second largest city, and partly own MBC-TV, the second largest television network in South Korea. It was once headed by the ruling party candidate, Park Geun-hye, from 1999 to 2005.

The foundation has since been run by former officials who were loyal to the late president. His daughter, Park Geun-hye, insists that she now has links to the foundation but critics argue that it is still under her control.

With Park Geun-hye's public approval rating falling ahead of the Dec. 19 election, the foundation is reportedly pushing to sell its stakes in the Busan Ilbo newspaper and MBC-TV networks and use the proceeds for underprivileged people, according to confidential information leaked to the media Saturday.

The foundation's plan, as reported by the Hankyoreh Shinmun newspaper, was secretly discussed in a meeting between the foundation's chairman, Choi Philip, and MBC-TV officials earlier this week.

The main opposition Democratic United Party (UPP) stepped in the controversy, denouncing the foundation's plan as a scheme to help the ruling party candidate's election campaign.

"It's been reported that the foundation intends to sell their stakes in those firms to use expected proceeds of 600 billion won ($540.2 million) for welfare projects in Busan and South Gyeongsang regions," said the UPP's floor spokesman Yoon Kwan-seok.

Yoon claimed that Park Geun-hye is trying to take advantage of the foundation to win the heart of voters in Busan, a main stronghold for the conservative ruling Saenuri Party.

"We must uncover whether selling the stake in MBC has been purely pursued by its president Kim Jae-chul alone, or was helped by the government," he said.

Yoon pointed out that the expected proceeds will be invested in Busan and its surrounding areas for welfare purposes, another circumstantial evidence that the scheme is intended to help the ruling party candidate be elected president.

The ruling party refuted the opposition party's claim, calling it a "negative strategy" to gain the upper hand in the tight race. (Yonhap News)