Can new Bangkok governor tame ‘black hole’ of city investment arm?
Branded a breeding ground of corruption by newly elected Bangkok Governor Chadchart Sittipunt, Krungthep Thanakom Co Ltd is set for a major transformation under his administration.
Chadchart’s chosen man, Prof Tongthong Chandransu has taken over as chairman and president of the state enterprise, which functions as City Hall’s investment arm. He is expected to inject transparency and efficiency into the operation, in line with Chadchart’s campaign pledge.
Krungthep Thanakom has often been linked with big scandals that have hit the Bangkok Metropolitan Administration (BMA) over the years. The company has handled many multibillion-baht projects, including those related to the BTS Green Line, BTS Gold Line, BRT (Bus Rapid Transit), waste collection and disposal, and the scheme to bury Bangkok’s snarl of overhead cables.
Bones of contention
Chadchart has vowed to lift the veil of mystery surrounding Krungthep Thanakom’s involvement in mega projects. For instance, the public still has no idea about the details of the controversial contract, signed by the BMA through Krungthep Thanakom, granting Bangkok Mass Transit System Plc (BTSC) the concession to run the BTS Green Line until 2042. It is also a mystery as to how the BMA financed the 25-billion-baht project to bury cables.
“It’s like a black hole,” Chadchart said of Krungthep Thanakom during his election campaign.
Tongthong insists the BMA’s investment arm must also shed light on controversial points related to other BTS concessions. His scrutiny extends to the company’s involvement in Bangkok waste-to-energy plants and waste-collection services.
Chadchart says Krungthep Thanakom will from now on publicize all information on procurement, to ensure accountability and proper checks and balances.
The governor expects transparency and data disclosure at every step, from project planning, bid submission and result announcement to contract preparations and project implementation.
What is Krungthep Thanakom
Krungthep Thanakom was set up as a limited company and so does not come under public-private partnership law or rules governing state enterprises, such as the Bangkok Mass Transit Authority.
BMA is its majority stakeholder, holding 99.98 percent of shares. Krungthep Thanakom was founded in 1942 by eight individuals under the name Sahasamakkee Kaset Co Ltd, for the trade, export and slaughter of animals. Its initial registered capital was 2 million baht.
In 1959, the company raised its registered capital to 50 million baht, with the BMA, known back then as Bangkok Municipality, stepping in to acquire 3,000 of its 50,000 shares.
In 1976, the BMA raised its stake to 99.98 percent and in 1995 renamed the company Krungthep Thanakom, putting it in charge of overseeing public-utility services for the capital. The company also gave up its slaughterhouses.
Now Krungthep Thanakom has several BTS extension routes under its profile. These include the Saphan Taksin-Wongwian Yai BTS route launched in 2008 and the BRT service rolled out in 2010. Then came the On Nut-Bearing BTS route in 2011, with the extension to Samut Prakan seven years later. The investment arm has overseen more BTS extensions launched over the past few years.
Is it time for change?
Krungthep Thanakom declares its existence is crucial as a BMA-owned corporation that ensures public services are delivered with the necessary quality and efficiency. And thanks to its company status, it enjoys agility and flexibility not shared by ordinary state organizations.
However, some critics insist Krungthep Thanakom is an unnecessary intermediary between the BMA and private entities such as suppliers. The company’s choice of suppliers often upsets the public, and Bangkokians are provided with no information about these decisions. This happens despite the fact that transparency and data disclosure are becoming standard in the public sector.
Observers also point out that the Bangkok governor has control over Krungthep Thanakom, which is why every time a new BMA chief is elected, the company’s board and executives get changed.
However, hopes are now high that Chadchart will spark positive and clear-cut changes to Krungthep Thanakom. And if the company improves, quality of life for Bangkokians is expected to benefit.
By Thai PBS World’s General Desk