Govt eases bid rules for flood deals

Cabinet counters critics, cuts B30bn requirement

The cabinet yesterday approved a proposal to ease the criteria for selecting contractors for its 350 billion baht flood prevention scheme.

The proposal was submitted for cabinet approval by the government-appointed Water and Flood Management Commission, chaired by Science and Technology Minister Plodprasop Suraswadi.

The terms of reference (ToR) for the scheme previously stated that each qualified contractor must have carried out projects with a combined value of at least 30 billion baht during the past 10 years.

Critics said this revealed the commission's intentions to hand over the lucrative megaprojects to wealthy overseas contractors and exclude smaller local contractors.

The commission agreed to change the ToR of the scheme to remove the 30 billion baht requirement.

The new requirement says bidders must have completed a project worth at least 10% of the total value of any flood project they apply for.

Mr Plodprasop said the flood prevention scheme will stick with the design-build approach, instead of a turnkey approach.

He said the government will make sure construction costs do not exceed the assigned budget.

Prospective bidders have been given until Sept 14 to submit details of their projects to the commission to qualify.

So far, 395 companies have expressed an interest in bidding.

The selection results will be announced on Jan 31, 2013.

Government spokeswoman Sansanee Nakphong said the criteria for a consortium of companies or joint venture bidding for the scheme is that each company in the consortium must have built a project with a value of at least 200 million baht. He said the project value of each of the firms in the grouping will be combined.

Prime Minister Yingluck Shinawatra said after the cabinet meeting yesterday that the scheme's bidding criteria did not favour foreign contractors.

She said the government must decide what is best for the country.

"What the government chooses will benefit the people and can be scrutinised," she said.

However, Ms Yingluck conceded that she was still concerned about water drainage in downstream areas.

Inefficient drainage in networks of canals in these areas could affect communities, she said.

Deputy government spokesman Anusorn Iamsa-ard said the cabinet yesterday also approved a new memorandum of understanding (MoU) on scientific and technical cooperation in water resource management and irrigation between Thailand and China.

The Agriculture and Cooperatives Ministry and the Chinese Water Resources Ministry signed an original MoU on April 2 in 1997. The MoU expired on April 2, 2007.

The new MoU had been drawn up by authorities from the two countries and submitted to the cabinet for approval.

Mr Plodprasop maintained the MoU would not favour Chinese companies in the bidding for the government's flood prevention scheme.

Chawalit Chantararat, executive director of consulting firm Team Group, said he agreed with the 200 million baht requirement for a consortium of contractors bidding for the project.

This would help Thai contractors secure contracts, he said.

It was tough for Thai contractors alone to meet the requirement calling for experience with projects worth at least 2 billion baht.

Most projects undertaken by Thai contractors were worth an average of 800 million baht, he said.

Mr Chawalit said it is still unclear if the 10% requirement for prospective bidders would help boost or limit the chances of Thai contractors.

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Writer: Patsara Jikkham & Pradit Ruangdit