State Audit Reveals Billions Wasted in Construction Projects

A recent state audit has uncovered significant financial mismanagement in construction projects across Thailand, revealing billions of baht wasted due to inefficient management and contract violations.

Key Takeaways

• Over B30 billion in financial losses due to inefficient management.
• 1,795 out of 9,426 public agencies found with budget management flaws.
• 2,638 out of 5,318 contracts failed to comply with legal or contractual obligations.
• Total damages from contract violations amount to B666.47 billion.
• Recommendations provided to improve 629 financial reports.

Audit Findings

The State Audit Office (SAO) of Thailand has reported financial losses exceeding B30 billion for the 2023 fiscal year. The audit covered over 14,148 projects and contracts from 9,426 public agencies nationwide. Flaws were identified in the budget management of 1,795 agencies, accounting for 19.04% of the total.

The SAO detected at least B30.83 billion of abnormal spending. Conditional recommendations were provided to improve 629 out of 8,575 financial reports being audited for accuracy. Most of these issues involved major expenditures with incomplete bookkeeping or insufficient clarifications, often related to cash, land, and real estate properties.

Contract Violations

The audit revealed that 2,638 out of 5,318 contracts, or 49.61%, failed to comply with legal or contractual obligations, resulting in damages totaling B666.47 billion. The abnormalities included violations of middle market price estimation, unclear contract statements, tax collection issues, and contract violations. Flaws were found in 151 of 157 cases, or 96.18%, of government agencies examined for efficiency in spending state funds.

Inefficiencies and Recommendations

The inefficiencies identified included incomplete or poorly prepared proposals for project operations and delayed timelines. The total damage from these inefficiencies was at least B30.16 billion. The SAO suggested that all related sectors cooperate to shorten the working deadline for the Rama II elevated road project from eight to five months to improve budget management. The B10.5 billion project, known for its delays, is expected to be completed in November.

Sources

• State audit finds billions wasted in construction projects, The Phuket News.

Gaël Ovide-Etienne

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