The Business Bidding Process for Projects and or Works for the Thai Government Essay Example

most serious national concern by household heads in Thailand, following a weak economy and high cost-of-living. Drug-related issues closely followed this matter in rankings. Among public institutions, the police and members of parliament were perceived as the least reliable, with the Ministry of Interior and Customs Department also lacking credibility.

Corruption is widely viewed as a societal affliction that has manifested throughout history in varying forms. As stated by the United Nations Office on Drugs and Crime (UNODC) report from 2011, corruption encompasses instances such as low-ranking officials accepting small bribes and politicians abusing their power for personal gain through large-scale projects. The UNODC emphasizes that corruption poses substantial threats to democracy, ethical values, justice, sustainable development, and the rule of law.

Corruption in Thailand is widespread during the "project bidding process," where government officials at different levels engage in unethical behavior. Whether it's municipalities, towns, provinces, or the national government, these officials participate in corrupt activities. When the Thai government needs to procure or construct something, it should take into account the overall costs, benefits, and welfare of the nation. Government contract bidding is a procedure that enables private or semi-private companies to compete for government projects, schemes, or developments.

The aim of the bidding process is to obtain high-quality goods and services at a low cost, while ensuring fairness and transparency. However, this ideal situation does not always occur. There are instances when secret negotiations and bribery happen, exploiting loopholes in national laws, rules, and regulations for personal gain (Vudthithornnatirak, 2010). This form of corruption occurs on a large scale involving politicians, government officials, and private sector entities collaborating to redirect funds from the government budget.

Corruption

in the bidding process occurs when those in power abuse their authority, leading to unfair competition, resource wastage, human rights violations, and neglect of basic needs. This systemic corruption causes a 20-30 percent increase in government procurement costs, resulting in the acquisition of lower quality goods and services and unnecessary purchases. Regrettably, these circumstances often lead to tragic consequences.

In the government sector, like when constructing a new Mass Rapid Transits train station in Bangkok, companies are asked to submit bids for projects. Unfortunately, unethical practices occur instead of fair competition. Some companies collude and agree on bidding strategies to guarantee one of them wins and then divide the project among themselves. Additionally, certain companies may resort to bribery to secure the winning bid.

At times, bureaucrats may request a bribe from a company before granting them a project, with preference given to those willing to pay the highest amount. In order to win bids and afford the bribery costs, private companies often resort to using lower quality materials. Rather than awarding contracts through competitive bidding, certain government agencies may grant a monopoly by evaluating several qualified private entities and selecting the most suitable one to operate a government enterprise as a concession.

The monopolization of projects leads to strong motivations for private entities to bribe influential officials and politicians who are responsible for the projects. The participants in this scheme collaborate as a team, with clear roles and responsibilities, in order to conceal their actions and illegally obtain money from the government budget. After accumulating profits, the funds are distributed to multiple individuals involved in different stages and subsequently undergo a money laundering process for secure storage.

The

issue of corruption can be likened to cancer as it continues to spread relentlessly with little ability to completely eradicate it. Corruption hampers economic development through various means, such as impeding domestic and foreign investments, increasing government expenditure, and diverting funds away from crucial sectors like education, health, and infrastructure maintenance. While a select few authorities and companies benefit from corruption, the innocent Thai population suffers as the victims of this problem.

People experienced inadequate infrastructure and government services, which resulted in them not receiving the benefits they deserved for the taxes they paid. Additionally, this situation exacerbated the economic disparities between social classes. In Thailand, there is a noticeable prevalence of "unexplained wealth" among a small group of individuals. It is common to witness governors and officials driving luxurious cars and residing in extravagant homes, despite their relatively modest salaries. Numerous officials accumulate wealth through bribery or through acquiring assets in an illegitimate manner while fulfilling their duties or exercising their power.

The majority of people are aware of the corruption that exists but are too afraid to report or question it due to the power held by the officers. Several officers abuse their power, behaving akin to a Western mafia group. If someone refuses to comply with their methods, they employ their authority to eliminate or attack that individual. It is ironic how people can coexist with subpar government products and services, yet lack the courage to voice their opinions.

The text emphasizes the significant impact of fear on innocent individuals and the increasing prevalence of corruption in Thai society due to a perception problem. Corruption in the bidding process is seen as normal by Thai

people in order to secure job opportunities. According to reports, it is expected that political parties engage in corrupt practices, which is accepted as long as there is ongoing economic growth. Furthermore, a poll conducted by Assumption University (ABAC) shows that 64% of Thais consider corruption acceptable if it benefits themselves or the country. Disturbing statistics reveal that even 70% of individuals under twenty years old support this viewpoint. Consequently, corruption and cheating have become deeply rooted in society, resulting in a worrisome spread of social acceptance among the younger generation.

Despite the presence of numerous anti-corruption organizations, such as The National Anti-Corruption Commission (NACC), and various campaigns aimed at promoting accountability, implementing measures at all levels of government, establishing a freedom of information commission, a national audit commission, and supporting the judiciary and ombudsmen, as well as raising awareness among children (Wescott, 2010), corruption continues to grow rapidly. Furthermore, there will be close monitoring of every bidding contract to ensure transparency and prevent any misconduct in public service.

The anti-corruption agencies have been facing bureaucratic obstacles that impede their investigations and hinder their effectiveness, resulting in unsatisfactory efforts to combat corruption. Despite extensive media coverage and news reports on the issue, little progress has been made in addressing the problem. An analysis of six Thai newspapers over the past five years reveals numerous articles on corruption but a lack of decisive measures taken. Successfully exposing corruption requires political resolve and dedicated social institutions committed to combating it. Thailand continues to face a significant challenge in tackling this issue.

The press in Thailand has limited power to combat corruption due to a lack of political determination and efficient legal

institutions. Instead, its main function is to disseminate information. Corruption mainly arises from political and administrative problems in Thailand, which foster an atmosphere conducive to corrupt activities such as monopolies, shielding against foreign competition, and backing illicit enterprises. A significant element that contributes to corruption within the Thai government is the belief that money plays a crucial role in the nation's progress, much like other developing countries.

Over time, the Thai population has developed an increasingly materialistic mindset. According to Tang et al. (2000), their study called "MES" showed that people's positive perception of money and its psychological importance can have a negative impact on behavior. Many individuals view money as the ultimate life goal, believing it provides them with the ability to obtain anything they desire. However, it is important to recognize that corruption in the Thai government is not solely caused by money; other factors such as education also contribute. Education plays a crucial role in combating corruption by providing knowledge and understanding of how the government functions and citizens' rights within it. Promoting education across all age groups is essential for establishing an effective and ethical governance system. Insufficient education prevents citizens from distinguishing between honest and dishonest candidates during elections and implementing measures to prevent corruption at the local level.

Municipalities often face governance by corrupt local officials who utilize patronage or nepotism to maintain their power and influence in government over extended periods. Moreover, people tend to unquestioningly accept propaganda or statements made by those in authoritative positions. The primary concern that necessitates attention is that of conduct and ethics. Politicians appear to lack the determination required to effectively combat the pervasive

corruption within society. Instead, they enter politics with personal interests at heart rather than a genuine desire to advance the nation. These officials fail to acknowledge that the funds they receive originate from citizens and should be utilized for their benefit. Despite collaborative efforts between the Transparency Organization and the National Institute of Development Administration (NIDA) through the "Toa Pai Mai Kong" project, aimed at discouraging corruption among primary school children, significant progress remains elusive due to ambiguous objectives and plans.

Both greed and the desire for wealth motivate individuals in powerful positions to exploit their influence, as observed from both demand-side and supply-side perspectives (Tutu, 2010). Public servants may seek bribes from contractors to ensure personal financial gain while entrepreneurs engaged in rent-seeking behavior use political influence advantageously. Business organizations and officials exert influence over public officials, leading to decisions that benefit them at the expense of the general citizenry.

In addition, low remuneration and poverty contribute further to corruption within society. Poverty, especially during local economic recessions, fuels corruption as individuals resort to corrupt means of earning money when unable to meet their needs. This serves as a major incentive for engaging in corrupt practices. Moreover, the scarcity of funds often results in lower wages for local officials, fostering corruption.

Officials who receive inadequate wages are often driven to corruption, such as accepting bribes or embezzling funds from the local treasury. However, increasing their salaries would establish a higher threshold for engaging in such unethical practices. Alternatively, some researchers propose that greater financial resources available to local governments can potentially lead to inefficient spending and raise suspicions of corruption. * Culture and Values

Besides, culture is one

of the factors that cause corruption. Denis Osborne's (1997) paper clearly documents the potential variations in attitude towards corruption and bribery across different countries and time periods (Osborne, 1997). According to Tanzi (1995), firms in certain countries are culturally less inclined to engage in arms-length economic relationships, which can ultimately contribute to a deeper level of corruption. The Thai culture itself can lead to a lack of awareness about corruption, as Thai people believe that giving presents to those who purchase their products is a positive traditional practice.

Despite the common belief that explicit demands are necessary, corruption can be so prevalent that they become unnecessary. The recognition of the need to make payments for decisions is widespread. According to Pasuk and Sungsidh (1999), power holds great importance in Thai culture, resulting in the establishment of a patron-client relationship in politics. Additionally, there has always been a tradition of presenting gifts to high-ranking officials. Although these practices were acceptable within the traditional patronage system, they are now considered problematic within the current legal framework.

In Thailand, the act of paying fees to officials is known as "sin nam jai" or the 'gifts of good will', and is not considered corruption. However, with corruption becoming more prevalent and deeply rooted in society, it is unsurprising that younger individuals are also embracing and engaging in corrupt and dishonest behaviors. It would be erroneous to perceive corruption solely as a moral problem, as teaching children about morals alone cannot completely eradicate it.

The dangerous issue arises when the majority of the public idolizes individuals who have amassed a large amount of wealth, regardless of whether it was obtained through corrupt means

or not. People tend to ignore suspicions surrounding those who have quickly gained significant financial assets in a short time. The younger generation is affected by witnessing such corrupt behavior, which leads to cynicism and demotivation, discouraging them from choosing an honest path. (Transparency, 2010) Additionally, there is also an incorrect prevalent attitude in Thailand.

The public frequently idolizes individuals who have amassed considerable wealth, regardless of whether it was obtained through corrupt methods or not. Individuals who rapidly accumulate a substantial amount of financial assets in a short timeframe are seldom questioned. This can be worrisome for younger generations as being raised in an environment where these practices are accepted may result in cynicism and discouragement, leading to minimal motivation to pursue an honest path (Zwart, 2003).* Additionally, the media contributes to this problem; free media is a crucial element of a democratic society.

Independent media is essential for true democracy, but some outlets like Channel nine are government-owned, leading to one-sided communication and limited access to accurate information. To combat this problem, laws should protect the independence of these media organizations from political influence and opportunistic leaders. Unfortunately, some media entities fear government power and avoid disclosing the truth. Despite widespread awareness among the Thai population about corruption in national bidding processes, little has been done to address this pressing issue.

Thai leaders' lack of political will has resulted in governmental and non-governmental organizations dedicated to fighting corruption being unrecognized. As a consequence, necessary improvements outlined in the constitution as laws have not been successfully implemented. The prevalence of corruption in Thai society is a major obstacle, mainly due to deficiencies in Thai Law.

Despite the establishment

of a legal framework in Thailand in the late 1990s to address corruption, the enforcement of anti-corruption laws has proven ineffective. In cases where a company is found guilty of fraudulent practices during bidding, it may be barred from participating in future competitive bids. Nevertheless, certain companies have been able to exploit this situation by establishing "nominee companies" that seem to be owned by individuals with no record of procurement deceit, but are actually owned by the banned company.

Global Integrity 2007 reports that Thailand does not have laws regarding conflict of interests for public procurement officials. Warsta (2004) observes that Thai leaders have shown little political determination in the past seven years, leading to the omission of specific improvements outlined in the constitution from legislation. Furthermore, corruption is widely accepted as normal in Thai society, which also exhibits resistance to change.

Sometime they pay governors in order to fulfill their desires, such as parents who are concerned about their lack of funds to afford "tea money" for their children's acceptance into Thailand's elite schools, should consider themselves lucky. (Cookson, 2011) This would teach them that it is acceptable to bribe authorities to obtain their desires and that money and connections are the only things that are important. * Lack of Management Thailand has been implementing a bidding process for a considerable amount of time; however, they have never established regulations or developed a proper plan for its effective execution.

It is well known that corruption can occur during the bidding process. Usually, the average price is set twice as high as the market price, and the project specifications are often fixed to benefit the company that pays

bribes to governors. This is a challenging issue to address because it is difficult to determine the market price at the time, regardless of the specificity of the specifications. The various corruption methods adapt well throughout the corruption process.

The text emphasizes the distinctive aspect and multiple methods of a certain feature, which is complex and hard to comprehend (Pruktas, 2005). It is challenging for individuals to detect corruption, yet they instinctively recognize when an official requires bribery. As an illustration, a company presents a quotation to the Dean of a faculty. In order to inform others of the price, the Dean will verbalize it loudly. Consequently, the company's staff will naturally understand that they must give a portion (10-20%) of the project's value to the Dean upon its completion. In reality, companies are aware of this process in advance and preemptively raise their price accordingly.

Therefore, the company will gain the same profit, Dean will also benefit, but the nation's revenue will decrease due to the lack of a consistent anti-corruption policy within the government. Even in cases where governments are not corrupt, the absence of a uniform anti-corruption policy within the government will hinder any effort by any government department to minimize corruption. For instance, a department in charge of international development may strive to promote ethical business practices, advocate for stronger laws against bribery, and push for the prosecution of companies engaged in bribery or fraud.

The department for trade, located within the same government, may prioritize business profitability. Therefore, their concerns lie in protecting business interests and advocating for more lenient corruption laws, reduced disclosure requirements, and blocking corruption prosecution. Although the government as

a whole is aiming to combat corruption, it is paradoxically undermining these efforts. Corruption can only be effectively addressed if it becomes an undeniable priority for all government departments.

The economic consequences of corruption are substantial, particularly in developing nations. It obstructs both economic progress and initiatives to alleviate poverty. James Wolfensohn emphasized at the 1996 Annual Meeting of the World Bank that corruption redirects resources from the impoverished to the wealthy, raises business expenses, distorts public spending, and discourages foreign investors. The World Economic Forum's Global Competitiveness Report 2009-2010 (Report T) also acknowledges this concern.

According to 2010 studies, companies consider corruption, along with government and policy instability and inefficient government bureaucracy, to be a significant obstacle to doing business in Thailand. Corruption is problematic because it negatively impacts economic growth. Not only do projects suffer financial losses due to corruption, but additional losses occur while attempting to combat and prevent it. However, fighting against corruption is necessary in order to strive for a better future.

Thais have made efforts to clean up their own country by implementing new laws and striving for good governance simultaneously. It is important to recognize the difficult situation when fighting corruption: those in power often have personal interests and little desire for change, despite benefiting economically. Public procurement poses a significant risk for corruption.

The occurrence of financial losses is often linked to corrupt practices that involve manipulating financial terms in a way that is detrimental to the country. One example of this is when the prices of purchased goods are artificially inflated well above the current market rate. Another example is when a prepayment clause is included in a public contract

instead of allowing for a delay in payment. Both of these corrupt practices result in financial losses. This estimate was provided by Osei-Tutu and Owusu-Manu in 2010.

According to the National Counter Corruption Commission, now known as the National Anti-Corruption Commission, corruption leads to approximately 30% of the government procurement budget disappearing. This not only hampers economic growth but also reduces domestic and foreign investment (Foundation, 2010). The Thai Chamber of Commerce's research reveals that last year, around 80% of companies had to pay bribes amounting to about twenty billion baht per year in order to secure government projects (Commerce, 2011). Saowanee and Thirongroj (2011) further support this finding by showing that 71% of companies know how to pay bribes without being prompted by government officials. Additionally, inflated prices set at about 10-30% higher than the actual cost can burden the government with an additional thirty billion baht (Phuchaum & Areepong, 2011). It is important to note that corruption in contracting is a global issue; it affects countries with high levels of honesty as well. Allegations suggest that bribes were paid during the construction of Terminal 2 at Frankfurt Airport in Germany, amounting to DM 2.5 billion and resulting in price increases of approximately 20-30% (Unnamed source, n.d.). Inefficiencies and lack of value for money due to corruption have been found in government and donor-funded projects across different countries according to Report R.B. (ASCE, n.d.).According to the American Society of Civil Engineers (ASCE, n.d.), corruption is responsible for $340 billion in global construction costs annually. A survey conducted by Lengwiler and Wolfstetter (2006) reveals that approximately $390-400 billion in bribes are exchanged through public sector procurement

worldwide each year. Despite auctions being recommended as an efficient method for procurement, they remain vulnerable to manipulation and corruption. The government bidding process serves as a prime example of this issue. Thus, addressing the growing corruption within our country has become a pressing concern. One suggested solution is education, which can significantly decrease corruption by ensuring individuals understand our nation's justice system processes and procedures (ASCE, n.d.; Lengwiler & Wolfstetter, 2006).

Authorities often exploit and manipulate uneducated individuals through bribery, threats, and propaganda. This is possible because these individuals are ignorant of the law, public rights, and live in fear. The government capitalizes on their blind trust and self-centeredness. However, a comprehensive education can offer them a more profound comprehension of society. It is crucial to educate them about their rights, instill the belief that the world belongs to all rather than just themselves, and promote independent thinking. By educating younger generations about this matter, we can foster optimism in our fight against corruption.

It is crucial to prioritize integrity training and ethics education, as stated by Pillay S. (2004). Both academics and professionals must have faith in the potential for positive change and continue their efforts towards the common good. Urgent reinforcement of ethics as a new cultural characteristic within the workplace, especially in public service, is imperative. Corruption awareness should not be limited to educated workers; even children should be taught about it from a young age. Including anti-corruption education in their primary curriculum would ensure that they comprehend the negative consequences associated with living in a corrupt society.

The Thai people must alter their mindset regarding corruption, as even minimal progress is still

unacceptable. Numerous undisclosed secrets are being concealed by the government from the general public, who seldom or never become aware of them. Although the government has accomplished the construction of an international airport, they have not revealed the expenditure involved. While people rejoice and find delight in this new establishment, hundreds of millions Baht are being siphoned into the personal accounts of government officials.

The government is involved in corrupt activities, misappropriating funds meant for healthcare and education across the country. This corruption is not acceptable, and it cannot be tolerated by the people. Both the government and citizens should take responsibility for addressing this problem. It is crucial for citizens to realize that the money belongs to them; therefore, they should establish Non-Government Organizations (NGOs) with sufficient financial resources to effectively respond. These organizations can play a crucial role in raising public awareness and supporting Thailand's progress.

According to Seliem (2009) and Baykaraeva (2010), policy makers should focus on fostering a culture of teamwork and changing society's consciousness towards corruption. Seliem emphasizes the importance of building and strengthening this culture, while Baykaraeva suggests that society needs to view corruption as a negative process that hinders a country's development. Both authors agree that anti-corruption policies are crucial and individuals should prioritize the progress of the entire country over their own self-interest. Corruption frequently arises when individuals are selfishly driven by personal benefits.

Such way of thinking needs to be changed quickly. The perception of governors must change, and the key to this change lies in providing proper education. It is through education that people can come to recognize the corrupt nature of the government. In order to drive

the country towards great prosperity, citizens should elect politicians who are honest and clean. Unfortunately, many of the current politicians have criminal tendencies. If these corrupt politicians are the ones in command, making laws and regulations, what kind of laws would be created? The main problem lies with the politicians themselves, especially when it comes to ethical aspects. Kernaghan (2004) supports the idea of providing ethics education and training for public servants, starting from senior officials to new employees.

The evaluation of ethical performance should be the basis for appointing and promoting all members of the public service, particularly its leadership. It is important to elaborate on the code of ethics under each principle. Some Thai academics propose that every level of public servant should be aware of the need to avoid corruption and strongly oppose it, likening it to cancer (Yossomsak, 2007). Strengthening investigation organizations and enacting new legislation are necessary. In reality, the bidding process should be the most equitable method when the government needs to make purchases. However, this process has a high potential for encouraging corruption as it can generate large sums of money and bribes are easily obtained. Changing this process is difficult due to the various ways corruption can occur. Furthermore, those involved can complicate matters further to evade investigation. The only solution is to increase penalties in the law for government corruption. This will instill fear and deter individuals from engaging in corrupt practices.