The new public-private partnership (PPP) draft bill is expected to take effect next month, with the aim of speeding up public investment of the 2-trillion-baht infrastructure budget, says Prasong Poontaneat, director-general of the State Enterprise Policy Office.
The new bill seeks to plug the loophole of the existing PPP Act that supposedly has held back 120 projects jointly invested in by the public and private sectors. The existing law is ambiguous and makes it difficult to settle disputes, he said.
Mr Prasong said the new law hopes to cut approval time to just seven or eight months from up to two years.
The draft, awaiting royal endorsement, will replace the 1992 PPP Act.
The bill will accelerate public investment significantly, as the public sector does not have the capital to invest in massive capital infrastructure crucial to the country's development, he said.
"This especially applies to projects under the 2-trillion-baht infrastructure plan for the next seven years. To ensure projects will materialise, the new bill sets an approval period, with 16 organic laws to be passed later to ensure practicality," said Mr Prasong.
For instance, the bill requires the government to set up a 2-billion-baht fund to promote partnerships by allowing new projects to use the fund to finance feasibility studies and terms-of-reference drafts without having to wait for projects to be approved first.
This process, which has to be paid for by each project up front now, has taken up to four years for some projects.
He expects the first project that needs to comply with the law will be the new skytrain route across Bangkok.
To settle disputes, the draft still uses the arbitration system in line with international standards. However, he said the existing system favours private companies due to the way contracts are drafted, so to ensure fairness the new law requires standard contracts are used for all PPP projects.
The bill requires a PPP policy committee be set up and chaired by the prime minister. Members of the committee could be punished with a three-year jail term if they violate the law.
Also, a committee member who resigns cannot be involved with projects he or she approved for two years after resignation.
Projects worth more than 1 billion baht may or may not be subject to the bill's provisions, depending on the discretion of the committee.