Moves to cut Klong Dan payout

[webfact]

Moves to cut Klong Dan payout
WASU VIPOOSANAPAT
THE NATION

Pollution Control Dept pushes to bring down compensation amount, which will rise by bt180m if not paid in 90 days

BANGKOK: -- THE POLLUTION Control Department (PCD) is in negotiations with a joint-venture company that won a court battle for more than Bt9 billion in compensation over the now-cancelled, graft-plagued Klong Dan wastewater-treatment plant.

PCD chiefs are hoping to get the amount reduced.

As of press time, PCD representatives were at the negotiation table with NVPSKG - a six-firm joint venture that had won the contract to construct the Klong Dan plant.

Last Friday, the Supreme Administrative Court ruled that the department should compensate the joint venture based on the ruling of an arbitration committee.

The PCD tried but failed to rebut the claim for compensation on grounds that it entered into a contract with NVPSKG believing that Northwest Water International was party to the contract.

But Northwest Water International withdrew from the joint venture - a move that PCD insisted made NVPSKG unqualified as a bidder.

In 2004, PCD also lodged complaints against several firms that were part of the joint venture, accusing them of fraud.

Signs of corruption

In 2009, several government officials and politicians, including former deputy interior minister Vatana Asavahame, were |found guilty of corruption related to the Klong Dan project.

The Supreme Administrative Court, meanwhile, ruled that the NVPSKG had completed part of the construction required for the Klong Dan project and that PCD was required to pay for work that has been done.

"This is a big lesson," PCD director general Wichien Jungrung-ruang lamented yesterday.

The PCD is required to pay the compensation within 90 days of the ruling or pay Bt180 million extra in interest.

Wichien said his department would consult the Office of the Attorney General and relevant agencies about the payment of the compensation.

Natural Resources and Environment Minister Dapong Ratanasuwan, meanwhile, said he would inform the Cabinet about the ruling and see if the money to settle the matter can be withdrawn from the central budget.

He also said he would set up a panel to investigate officials who were involved in the controversial project.

Wichien said the project had caused huge damage to the government as the total amount, including compensation, was up to about Bt33 billion.

Massive damage

"This is the biggest financial damage from a single project in the government's history," he said.

The infamous case began in 1997 when PCD hired NVPSKG Joint Venture to design and build the Klong Dan wastewater facility worth Bt23 billion.

Meanwhile, director of Ecological Alert and Recovery-Thailand (Earth), Penchom Sae-tang, said corrupt politicians involved in the project should be made to cover the compensation.

"The government should not waste citizen's taxes, but seize this money from the corrupt people who were involved instead," she said.

Source: http://www.nationmultimedia.com/national/Moves-to-cut-Klong-Dan-payout-30248490.html


-- The Nation 2014-11-25

[rametindallas]

According to another news source, three companies, all owned by the same investors; first company bought land from landowners at 20,000 Baht per rai and those that didn't want to sell had access to their land blocked by those plots that were sold. If they still didn't sell, duplicate land titles were created to cheat them out of their land. After this was done, the 1,900 rai block was sold to another company, owned by the same investors, for 100,000 Baht per rai and then, sold to the third company, owned by the same group of investors, for 260,000 Baht per Rai. The Pollution Control Department of Thailand then bought the parcel of land for one million Baht per rai. The location was the moved and the effluent would flow directly into the sea. When the people in Samut Prakarn found out what was happening, they organized protests but were overridden by authorities who never got public input, environmental impact studies, or human impact studies. No provisions were made in the budget for those displaced or harmed by the project. The wastewater treatment plant was not designed for industrial waste but for household waste only. This case was known as the 'Mother of all Corruption' until the most recent Rice Support Scheme of the Yingluck government. Just in case some members are new to Thailand, Thaksin is not the first big crook to use government to enrich himself. The Klong Dan Wastewater scandal happened under the Democrat PM Chuan Leekpai and that is probably why the people of Samut Prakarn will never vote Democrat again. Klong Dan: the corruption that keeps on taking.

For the full story, google: klong dan mother of corruption.

[webfact]

Minister Davapong vows to find wrongdoers to pay off the huge compensation after losing court battle



BANGKOK: -- The Pollution Control Department (PCD) will propose the Government to pay off the estimated 20 billion baht damages compensation to the private sector after it lost the decade long Klong Dan waste water treatment plant case.

But at the same time, the Natural Resources and Environment Minister Gen Davapong Rattanasuwan vowed to find those people responsible for the case to the trial and absorb the loss for the record high damages that the state has to pay as compensation after losing the almost 20 years long court battle

The department’s movement came as the Supreme Administrative Court handed down the verdict ordering the Department to pay six contractors an estimated 20 billion baht in compensation which included interest after it revoked their contracts to construct the Klong Dan waste water treatment plant of which construction was then ongoing.

The cancellation forced the construction consortium to bring the dispute to the Administrative Court.

Gen Davapong stated upon learning of the court case loss “the project caused some 10-20 billion baht losses to the state. This money came from people taxes. We know who and what were to be blamed for this. I am the Natural Resources and Environment Minister now and my job is to cut losses to the state and find wrongdoers and bring them to justice.”

Director-general of Pollution Control Department Mr Wichian Jungrungruang said after the department finished studying the court’s verdict, he would make a budge request to the cabinet to compensate the consortium as ordered by the court.

The Supreme Administrative Court ruled on November 21 that the department has to pay the consortium responsible for the construction of the 21 billion baht Klong Dan Waste Water Treatment Plant in Samut Prakan province compensation worth some 10 billion baht.

But he said the department would negotiate with the consortium for easing of the payment or some reduction.

Besides it would also find people who should be held responsible for all the fraud.

According to earlier report, people held responsible comprises of former politicians, retired and active government officials, and private sector.

The Klong Dan Waste Water Treatment Plant is considered one of the country’s most corruption-plagued projects.

It caused financial damage worth some 30 billion baht to the state, consisting of 21 billion baht construction cost and 10 billion baht compensation.

Mr Wichian conceded that the losses caused by the project were the heaviest in the country’s history.

According to the PCD director-general, the department has already filed four lawsuits against individuals including former politicians and private companies for alleged corruption and breaching contracts with the department.

The first lawsuit was filed against 11 individuals and eight companies for alleged corruption.

The second lawsuit was filed with the National Anti-Corruption Commission against 17 individuals.

The third lawsuit was filed against 15 individuals including two well-known politicians for breaching construction contracts.

The last was the civil lawsuit against 3 civil servants, demanding their compensation worth 8.5 billion baht.

Meanwhile, Finance Minister Sommai Phasee said the ministry is studying the court’s verdict to help the department find enough money to pay the compensation to the consortium.

In 1997, the Pollution Control Department signed a contract with the consortium, made up of six companies namely Vichitbhan Construction, Seesaeng Karn Yotha, Prayunwit Construction, Krung Thon Engineering, Gateway Development Company, and Samut Prakan Operating, for the construction of the waste water treatment plant.

In 2003, the department decided to cease the contract after discovering massive fraud in the project, prompting the consortium to file a petition with the arbitration committee demanding compensation for the project.

Source: http://englishnews.thaipbs.or.th/minister-davapong-vows-find-wrongdoers-pay-huge-compensation-losing-court-battle


-- Thai PBS 2014-11-25

[timmyp]

Edit: Whoops! Totally posted on the wrong page!

Edited November 25, 2014 by timmyp

[timmyp]

Thanks for the search parameters to find out the background on this story, I didn't know about it.

Google klong dan mother of corruption

[Estrada]

Personally it looks like business as usual for the usual suspects. The PCD needs investigating for its "misprocurement" of this project.

I was involved from the early stages with this project. The NACC took former PM (Initials) BS-A and former Minister (Initials) S.L to court where they were found guilty and their companies were fined the princely sum of B6,000!. The Pollution Control Department(PCD) were responsible for doubling the cost of construction from B13Billion to B23Billion whilst simplifying the construction by combining two plants into one big one. I am an expert in waste water treatment and originally working with North West Water who pulled out. The new design for treating industrial sewage with a domestic sewage plant was never going to succesfully treat the water. Here are some findings from the NACC investigation:

The Japan Bank for International Cooperation (JBIC), a major creditor of the corrupt-ridden Klong Dan wastewater treatment plant in Samut Prakan, asked the Thai government for the immediate repayment of 1.6 billion baht. JBIC stated that it treated all disbursements made to the project as "misprocurement", a diplomatic terms meaning "corruption" and "official theft". It also said the government had for the past two years failed to inform the bank that North West International, a crucial party of the joint venture, had pulled out before the consortium won the 23-billion-baht contract. The government then cancelled its contract with NVPSKG consortium for breach of contract after handing over about 20 billion baht.

The Special Investigation Department (SID), submitted a report to Natural Resources and Environment Minister. Police investigators requested arrest warrants for veteran politician Vatana Asavahame, his brother Somporn, his long-time close aide Man Pattanotai and seven others were charged with involvement in the corruption. Mr Vatana immediately denied all charges.

Mr Vatana and his associates formed a company over in the early 1990s to buy about 900 rai of land, not for the wastewater plant but for sale to a golf course development company, apparently referring to Palm Beach. He received no more than 100,000 baht per rai from the sale. The land was sold to the former Ministry of Science, Technology, and Environment at 1,030,000baht per rai. Mr Vatana used his authority while serving as deputy interior minister from 1988-1990 to persuade officials of the Land Department to issue title deeds to the land which included a public garbage dumpsite, two public canals and a mangrove forest.

Mr Vatana's brother Somporn, Ms Boonsri and Ms Lalin were cited as major shareholders of Palm Beach Development Co which accumulated public land and illegally obtained title deeds for the land. Mr Vatana was not a shareholder of Klong Dan Marine and Fishery Co Ltd, which sold the land to the state. This case was built from the point that Palm Beach, with which Mr Vattana had close ties, illegally obtained title deeds. Palm Beach sold the land to Klong Dan Marine and Fishery, which sold it to the PCD. Ex-pollution control chief Pakit initiated the project and reportedly modified the original plan for two plants to a large single plant. The change pushed the cost up from 13 billion to 23 billion baht. Mr Pakit also advised four construction companies to include a design with only one treatment plant as an alternative, while cabinet was still calling for a project with two plants.