Procurement law expands coverage
Approval to opt out on case-by-case basis
The Government Procurement and Supplies Management Act of 2017 has extended adoption of the state procurement process to over 9,000 state agencies in central, regional and local areas from only 1,000 under the previous regulation.
The new law, which took effect from Aug 23, requires central, regional and local state agencies, independent bodies and organisations under the constitution to apply the state procurement process, said Suttirat Rattanachot, director-general of the Comptroller-General’s Department.
However, 33 state enterprises and some agencies have sought approval from a committee on state procurement chaired by Finance Minister Apisak Tantivorawong to issue their own regulations governing the procurement process, with the goal of providing more flexibility.
Ms Suttirat used the Foreign Ministry as an example. The ministry has sought the approval not to apply the state procurement process as the Consular Affairs Department is required to comply with the regulations of each country when it makes procurements overseas.
The new regulations must be in accordance with state procurement management principles, meaning they must be worthwhile, transparent and with measurable efficacy.
Ms Suttirat said permission for state enterprises to issue their own regulations concerning procurement can be given only to those enterprises that must compete with operators in the same business to enhance competitiveness, but these will be looked at on a case-by-case basis, not for all procurement transactions.
For instance, PTT makes oil trade transactions and their price varies according to the global market, so it cannot set a reference price as required by law.
The 33 state enterprises include the national oil and gas conglomerate PTT Plc, the national carrier Thai Airways International Plc, the Electricity Generating Authority of Thailand, the Metropolitan Electricity Authority, the Provincial Electricity Authority, TOT Plc, MCOT Plc, Government Savings Bank, GH Bank and the Bank for Agriculture and Agricultural Cooperatives.
The Government Procurement and Supplies Management Act of 1997 that replaced procurement regulations of the Office of the Prime Minister in 1992 allows people to participate as observers every step of the process, from drafting the terms of reference to completing the procurement process, as well as setting penalties for authorities, officials or the accomplices who take bribes or fail to perform their duties in goodwill. Offenders are subject to one to 10 years imprisonment and/or a fine of 20,000-200,000 baht.
For the 2017 fiscal year, the government’s investment budget amounts to 548 billion baht and state enterprises’ investment budget totals 370 billion.
The new law requires 9,000 state agencies to apply the state procurement process, according to the ComptrollerGeneral’s Department.