Will we get value for money from spending plan?
The government is borrowing heavily to finance infrastructure projects; while these are necessary, we must ensure that the process is transparent.The government is planning to spend Bt2 trillion on infrastructure projects. It is imperative that the process to pass the bill for this massive spending programme is transparent. The programme will create a debt burden that will last for the next 50 years.
The government has, however, so far been unable to address the public's concerns and questions over details of the infrastructure spending. Although everyone agrees with the necessity to improve logistics development projects, economists, opposition politicians and academics have expressed concern over whether the money will be well spent. The main issue is that the government has not provided enough details to convince the public that its money will serve the purpose for which it is intended.
Worse, the government has chosen to ignore the conventional budgetary approval process by issuing an off-budget draft bill, which will result in limited chances to examine the spending process. The conventional fiscal budgetary process, on the other hand, allows for a more transparent process in scrutinising the government's spending plans.
It is obvious that Thailand has to improve its infrastructure and logistics systems to support sustainable development. Unfortunately, many urgent infrastructure projects have been delayed because of political factors such as regular changes of government or disagreements between different ministries.
But the process to approve funding for such massive projects must be explainable to the public. In particular, the details of each project and its specifications must be fully revealed. The procedure to select bidders and the rationale behind each project should be able to convince the public that the project will serve to benefit the majority.
Feasibility studies for projects under the Bt2-trillion plan have yet to be made available to the public. In addition, the government has yet to make available the details of project management to ensure transparency and good governance in all operations.
Projects on this scale must pass environmental assessments because they will certainly have an ecological impact. But the public has yet to be engaged in the discussion. For instance, there are questions over whether it is imperative to build an expensive high-speed rail link to connect Bangkok and Pattaya.
While most of the projects are undoubtedly necessary, the government doesn't have to finance all of them by creating additional public debt. The government, in fact, has various options - for instance, by encouraging private-sector participation to ease its fiscal burden, as in the case of the Bangkok Mass Transit System.
However, for the massive Bt2-trillion package, the government has not even disclosed the necessity of each project and has not explored alternative finance options available to meet the public interest. Instead, it has hastily pushed forward the bill, which will be financed entirely by borrowing. This has raised questions over the rationale behind some of the projects. They would be more explicable if they could be shown to be worthwhile investments that will yield long-term benefits and even profit, and not entirely rely on borrowing and thus place an unmanageable burden on the public purse.
Some critics charge that the growth projections based on the borrowing suggest that the projects do not stand on sustainable and solid foundations. This massive level of borrowing could have serious effects in the long term. The Public Debt Management Office hints that this amount of borrowing could raise the country's public debt to gross domestic product ratio to 60 per cent. The debt crises in some countries in the European Union, such as Greece, are a result of excessive borrowing. The negative social and economic effects will last for many generations.
It would be a disaster if the planned spending programme does not produce the results the government has promised. It would be shameful if our generation creates an unnecessary debt burden for future generations to shoulder for the sake of our greed and short-sighted ambitions.