No more late passes
After more than five years of delay, the House of Representatives has finally decided to fine the contractor responsible for the new parliament’s construction. However, whether the penalty will be enforced or not remains in doubt.
The secretariat of the House of Representatives recently rejected a request by Sino-Thai Engineering and Construction Plc (Stecon) to extend the construction period of the 23-billion-baht parliament complex for a fifth time, from January to May, after the company failed to finish the project by the deadline set on Dec 31.
Following the decision, Stecon is now subject to a fine of 12.3 million baht per day, until construction is complete.
Stecon has appealed against the decision and requested the fines be waived, citing “work outside the main contract” as the reason for the slow progress — referring to additional works which include the installation of information technology systems, communication and audio-visual cables. It also blamed the Covid-19 pandemic for the delay, saying workers have been barred from accessing construction sites in Bangkok and imported materials didn’t arrive in time.
It is the first time the House secretariat has rejected the contractor’s request to extend the construction period.
The Secretariat said last week it would ask the Comptroller General’s Department, which is responsible for the state’s procurement policy, to decide on the company’s appeal.
One problem in Thailand’s state procurement system is the deep-rooted cronyism and patronage which take place. In several projects, authorities can be seen protecting private sector benefits, rather than national interests.
In the case of the new parliament building, the House secretariat has repeatedly allowed the project’s contractor to get away with missing deadlines without taking any responsibility for them.
Not only has construction suffered long delays, but the project’s budget has also ballooned from 14 billion baht to 23 billion baht.
Meanwhile, the contractor filed a lawsuit with the Administrative Court last year, demanding 1.59 billion baht for the delayed handover of several parcels of land required to construct the complex — particularly around Yothinburana School and Thor Pha community.
If the House secretariat loses the case, it would be another “cost of stupidity” which taxpayers will have to pay.
The term “cost of stupidity” is used to describe the huge compensation that the government or a state agency often has to pay private contractors for mistakes they made, which lead unfinished projects or long delays.
Several state projects had been subject to such compensation, including the Hopewell elevated train and Klong Dan wastewater treatment plant.
Taxpayers certainly don’t want their money used for such payouts. Satit Prasertsak, deputy secretary-general of the House secretariat, said Stecon now says it will finish the main contract by the end of April.
This means that a 120-day delay from the Dec 31 deadline, or equivalent to a 1.47-billion-baht fine.
The sum could be used to cover “the cost of stupidity” if the government loses the lawsuit.
The time has come for the House Secretariat to show its seriousness in protecting the the state’s interests. Any kind of compromise when it comes to that must be dealt with swiftly.