The cost of stupidity. That was the term used by the Thai media to describe the 11.8-billion-baht in compensation that the government has to pay Hopewell (Thailand) Co, the developer of the unfinished mega-transport project, following a ruling by the Supreme Administrative Court on Monday.
Unfortunately, this was not the first massive payout thrust on the state. And it will not be the last. Thailand has never learned from its many huge mistakes.
Since its termination two decades ago, the Hopewell project has stood as a symbol of failure on the part of many previous governments. It comprised a 60 kilometre-elevated railway as well as a tollway in Bangkok. The Chatichai Choonhavan government signed the contract with Hopewell Co in 1990.
After that, construction ran mainly behind schedule. The developer failed to finish 90% of the construction by 1997 and was only 13% complete when construction was halted that year with the firm blaming the State Railway of Thailand (SRT) delay in allocating sufficient land for the project. Impacts of the Asian financial crisis also contributed to the project's halt.
As a result, the Chuan government decided to terminate the contract in 1998. Both the Arbitration Tribunal and the Supreme Administration Court ruled that this was unfair.
Earlier, critics pointed out that conditions set out in the contract were arranged in a way that put the state at a disadvantage. For example, the contract did not allow the government to terminate the contract. But it enabled the developer to do so.
As a result of the court ruling, the Transport Ministry and the SRT will have to foot the bill within the next six months.
The Pollution Control Department (PCD) once followed a similar path. In 2014, it was ordered by the Supreme Administrative Court to pay 9 billion baht in compensation to a consortium of developers -- NVPSKG -- of the Klong Dan wastewater treatment plant for the state's termination of that project in 2003. After investing about 20 billion baht in the project, the Thaksin Shinawatra government found corruption linked to the project and decided to scrap it.
Like the Hopewell project, it was never finished and never used to serve the public interest.
The country should have seen these and other failed megaprojects as costly lessons to learn from in order to avoid the same mistakes. On the contrary, the state has kept devising policies and deals that let developers and business operators get away with demands at the cost of taxpayers' money.
One recent example is the current regime's decision to allow the three big mobile operators to delay their combined 151-billion-baht payment to the state and to use state revenue from the upcoming 5G auction to subsidise the ailing digital TV industry.
Another example is the project to construct a new parliament building.
The construction, however, has suffered a four-year delay while the project budget has ballooned from 14 billion baht to nearly 22 billion baht. Parliament has let the developer get away with missing the deadline without taking responsibility for it.
Given that the land where the old parliament building sits has been returned to the Crown Property Bureau, a new government and new lawmakers starting this May will have to meet in an auditorium rented from telecom firm TOT at a cost of 11 million baht per month.
Thai taxpayers should no longer be forced to foot this kind of bill.