Critics have been quick to say that electronic auctions for government procurement contracts are not a main cause for delays in public spending. They also oppose the government's decision to raise the minimum value for contracts subject to the auctions.

The Finance Ministry an-nounced on Friday that it planned to raise the minimum value of government procurement contracts required to be awarded by electronic auction from Bt2 million to Bt5 million, saying the higher ceiling would "speed up" public spending, especially in the provinces.

The move comes in part as a result of complaints by provincial governors that the auctions have slowed down government spending in their provinces.

But some senior officials at the Finance Ministry and economists believe that e-auctions are not a serious cause for delays in public spending as argued by the government. They also say the auctions prevent corruption.

Pairoj Vongvipanond, former dean of the economics faculty at Chulalongkorn University, said that if the government wanted to curb corruption it should stick to current e-auction procedures.

He said the merit of the e-auction was that it disclosed information and allowed more bidders, resulting in lower cost to the taxpayer.

Caretaker Deputy Finance Minister Varathep Ratanakorn told provincial governors on Friday that the change in the minimum contract value would be submitted to the Cabinet this week.

A source at the Finance Ministry said he would agree to the proposal if it were temporary. He said that if the change were limited to the current fiscal year, ending in September, it could give a boost to the economy, which has been hit hard by high oil prices and the delay in the formation of the new government.

But he argued that all such auctions lessened collusion between bidders and officials at central and local government agencies, including state enterprises. He said government procurement through contracts valued at less than Bt5 million accounted for 50 per cent of government procurement contracts annually. He pointed out that bidders for small contracts would be hit the most, because e-auctions allow more bidders to compete. He also said the auctions provided all bidders with more information, as they could look at the websites of government agencies.

Before the e-auctions, information was often disclosed to just a few bidders familiar with specific government agencies, leading to collusion among bidders and between bidders and officials.

"If we really want to eliminate collusion we ought to have e-auctions for every government procurement," the source said.

Earlier, executives of state enterprises complained to the Finance Ministry that e-auctions were a major cause of delays in investment spending and asked for the revised minimum value of contracts subject to the auctions. They also claimed that creating panels to supervise e-auction was "a tricky business" because they could not find qualified people to sit on the panels.

But the source at the ministry said the regulations for e-auctions were unlikely to complicate government procurement. Rather, he said, it was the state-enterprise rules that should be blamed as, for example, every change in terms of reference needed approval by the board of each state enterprise and board meetings were held only once a month.

The source also argued that getting qualified panels to supervise e-auctions had become an issue, because the enterprises wanted to name people they could control.

The official insisted that government agencies and local government bodies did not experience delays caused by e-auctions.

"When we examined the complaints of provincial governors blaming the e-auctions we found that they'd missed the point. They could still disburse budget within three days under the e-auctions, so they are fast enough", he said.

Wichit Chaitrong

The Nation