Administration and Management of State Property
According to the Ratchaphatsadu Land Act, B.E. 2518 (1975), State Property is defined as all types of real assets belonging to the country, except for the following public properties:
Waste lands and lands that have been abandoned by or expropriated from their owners for the benefit of the country by any means specified in the Land Bill.
Real property to be used by the citizens or reserved for the benefit of the public, such as shorelines, waterways, lakes, and public highways; However, real property owned by enterprises that are juristic persons or by local administrative organisations are not included as State Property.
The Treasury Department is the governmental unit that is responsible for governing, overseeing, and maintaining State Property. Some State Property is administered to create income for the government; while other State Property is to be set aside for the use of other governmental units. Since the economic crisis of 1997, every Thai government has tried to solve the various problems especially dependence on exports and foreign investment. However, Thailand’s current economic condition has been aggravated by the current global economic recession, causing it to recover very slowly. When the self-sufficiency policy was proclaimed by the present government, one policy to be implemented was the asset-based economy. As the unit responsible for State Property, a potential resource for use in the country’s economic development, the Treasury Department is responding to government policy by attempting to improve the economy through increasing the profitability of State Property. This effort started with the definition of new visions, missions and conceptual frameworks to specify appropriate strategies that can lead to new missions and to the achievement of the goals set forth in the policy. Targeting both the micro- and macro-economic levels, the Treasury Department has established the four following goals for administration of State Property:
1. To expand development to the provinces
Since there is much State Property around the country, the Treasury Department can develop these lands to support various types of communities. For instance, Chiang Mai and Phuket are high-potential tourist destinations. If the Treasury Department uses these lands to promote investment, for example, by building international conference centers and hotels, this will increase employment. However, using the State lands cause total domestic travel costs to be
lower than those for other countries. Income from foreign tourists will increase and other downstream industries will also benefit. The ultimate goal is to improve the life of the Thai people.
2. To strengthen society at the fundamental level
It is well-known that fundamental problems in Thai society have long been neglected. Without public support system, Thai society can soon face a crisis. If the Treasury Department makes its lands available for social activities, for example, for public parks in various local areas, the department will play an important role in supporting and strengthening Thai society at the basic level. Alternatively, the lands can be allocated for low-income housing. The benefits will be greater than any monetary analysis would indicate.
3. To support production and investment
The country has recovered very slowly from the recent economic downturn partly because of the lack of investment by the private sector, caused by the high cost of land. If the Treasury Department can use its lands for the benefit of various businesses, for example, by developing certain properties as distribution centers, shopping centers, ports or bus stations, the department can thereby support government policies, i.e., the small- and medium-sized enterprise policy, the “one Tambon (district), one product” policy, and the village fund policy.
4. To improve infrastructure
Because public utilities are the most important factor in attracting investment, Thailand should have good public utilities, sufficient for demand at a low cost. Efficient public utilities will reduce production costs for manufacturers. One goal of the department is to use its lands to improve the country’s infrastructure, i.e., roads, electricity, water supply, and telephone networks.
Use of the State Property for Governmental Purposes
Use of the State Property for governmental purposes means allowing ministries, sub-ministries, departments, local administrative organizations, government units or other government organizations to use such properties for governmental buildings or for such locations such as
government centers, offices, city halls, schools, hospitals, district offices, police stations, and military services. Any government unit which wants to use State Property can submit a request to the Treasury Department. In order to decrease public expenditures, any ministry, sub-ministry, department, local administrative organisation, government unit or other governmental organization which wants to use the State Property can submit a request through the following procedure:
- For State Property located in Bangkok, arrangements are to be made with the Treasury Department.
- For State Property in other provinces, the request must be submitted through the provincial governor. When the submission has been accepted, the Treasury Department will make a decision regarding permission to use the unit requested according to the necessity and appropriateness of the request within 30 days after the day on which the petition has been received. If necessary, the period may be further extended for no longer than 90 days. If there is any problem related to the request, the State Property committee will make the final decision. If the property is in use by another governmental unit, the requesting unit has to make an agreement with the other unit and enclose the letter of consent in its submission. When a building is constructed on the State land, the requesting unit has to inform the Treasury Department and register the structure with the Treasury Department or the authorised local Treasury Department office that is responsible for the State Property Register and within 30 days after the day on which construction of the structure has been completed.
Use of State Property for Economic Purposes
1.Commercial development of State Property has the goal of managing the limited resources of State Property efficiently in order to generate maximum benefit, consistent with the price of the land, for the country in terms of economy, society and environment. In principle, if State Property used by a government unit for governmental purposes is in a commercial area that is not suitable for use as a government office, the Treasury Department should develop it and put it up for auction to find an investor who will construct buildings and have the Ministry of Finance own them. The Treasury Department will set the conditions under which bidders must buy the land and give the land to the governmental unit to become the land owner. Then the bidders have to construct buildings or structures on the land as the governmental unit has requested and proposed a sum of service charge. The government will grant the winning bidder a lease in yearly terms for the buildings constructed on State Property.
If conditions for the State Property that the Treasury Department has lease for residential or agricultural purposes has changed, the department may consider granting ownership to the last owner under the same conditions as found in item 1 or under different conditions, depending on suitability and the facts in each individual case. The Treasury Department may also use State Property to generate income by using other kinds of compensation contracts in addition to the above methods. However, such contracts must be approved by the Ministry of Finance, as implied by Section 23 in the Ministerial Regulations About the Principles for, the Administration, Maintenance, and Use of, and Profit Generation for State Property, B.E. 2545 (2002), issued according to The Ratchaphatsadu Land Act, B.E. 2518 (1975). Important examples of profit generation through various methods are as follows:
1. Lease of State Buildings such as hotels, markets, shophouses (for commercial use), cinemas, and department stores.
2. Lease of State Property to profit-making state enterprises. The government thereby receives income from both the business operated by the profit-making state enterprise and the rent from the State Property. Examples of state enterprises that rent State Property are CAT Telecom Public Company Limited, the Electricity Generating Authority of Thailand, the Provincial Electricity Authority, the Telephone Organization of Thailand Public Company Limited, and the Fish Market Organization.
3. Lease of State Property to the Department of Local Administration to use generate profits by the Local Administration Department in each area. Half of the income from the rent is returned to the Department of Local Administration and not considered as income due to the central government. This is to promote the government’s policy on income distribution to localities and the development of localities. Under this policy, people will improve their living conditions.
4. Lease of NCC Management and Development Co., Ltd. to administer the Queen Sirikit National Convention Center and build a 400-room hotel, parking area for 3,000 vehicles and 28,000 square meters of commercial space. The project is worth not less than 2,732 million baht.
5. The Morchit Mass Transit Station Development Project: The Morchit land totals 63-2-65 rai. Forty rai at the rear of the property is currently rented by the Bangkok Metropolitan Administration for construction of a parking area the BTSC depot. The area in front, slightly more than 23 rai, and some part of the rear area was put up for auction and sold to Bangkok Terminal Co., Ltd. for development as a transportation center and a modern complete national mass transportation center to help solve the traffic problem. The project is worth approximately 18,000 million baht.
6. Development project for the State Property with the Registration number PKN242. Seaside Hotel Co., Ltd. built the Hyatt Regency Hua Hin Hotel on the land, Registration number PKN242, Nong Kae Subdistrict, Hua Hin District, Prachuap Khiri Khan Province. The hotel comprises 205 rooms and is worth approximately 1,420,541,177 baht. Use of State Property for Social and Environmental Purposes Development of human resources and improvement of the quality of life State Property is a very important means which the State administration can make use of in order to accomplish the economic and social policies of the government and to create growth in the country. Use of State Property for social purposes can be classified as follows:
1. Expansion of educational opportunities by using State Property to build government schools and universities
2. Improvements in public health by using State Property to build government hospitals.]
3. Improvement of people’s quality of life
The Treasury Department is working in collaboration with the National Housing Authority to carry out a housing project for low-income citizens by leasing State Property around the country to the National Housing Authority at nominal rates. The National Housing Authority then uses the land to build residences for low-income earners.
The National Housing Authority will construct buildings for rent by low-income earners in urban areas. Depending on the economic, social and environmental conditions in each area, the Authority will construct rental properties for government officials with studio and 1-bedroom apartments of 24 to 31 square meters, or row-houses. The project targets the provinces in need of help for low-income earners and people who are no capable of buying their own residences so that they can rent an appropriate residence at an affordable rate.
Use of State Property for Social and Environmental Purposes
This housing project will start in 20-25 provinces, including Nonthaburi, Chonburi, Nakhon Pathom, Surat Thani, Kanchanaburi, Phetchaburi, Songkhla as well as other areas that the National Housing Authority considers appropriate. State Property will fix rents at a minimal rate so residents will be charged at an affordable rate.
Development of Natural Resources and the Environment
Public park projects: The Treasury Department, the Ministry of Finance, has a policy of building both small and large public parks to improve the quality of life and the mental health of the population and to improve the environment in urban areas. Examples of this project are:
- Chalerm Kanchanapisek Park
The park is located in Bang Sri Mueang Subdistrict, Mueang District, Nonthaburi Province. The park includes additionally-acquired area, approximately 100 rai in total.
The park was dedicated to King Bhumibol Adulyadej on the occasion of the 50th anniversary of His Majesty’s reign and in response to the King’s royal suggestion to build more public parks for recreational use and for the culture of as many species as possible, depending on local conditions, of water plants and other plant species. The park is home to aquatic animals and the Thai-landscape park, which is a unique feature of this park because this area is abundant in water all year round.
2. Benjasiri Park
On 19 December 1992, the cabinet decided to transfer the Thai Meteorological Department from the State Property premises on Sukhumvit Road to another location and ordered the Ministry of Finance, through the Treasury Department, to build a public park
on the property. The park was dedicated to Queen Sirikit on the occasion of Her Majesty’s 60th birthday in 1995. Benjasiri Park was built on a 30-rai piece of State Property on Sukhumvit Road. The park is an oasis in the middle of the desert because the Sukhumvit area suffers from a lack of public recreational facilities. This park is a frequently-used community park. One of the park’s unique features, to the honor of the Queen, is the large extent of greenery added to the park so that people of all ages and income levels can benefit from the park to the greatest extent possible. There is an opening and closing control system, the well-arranged traffic system both inside and outside the park, resulting in a very high level of security. Inside the park, there is a botanical garden, a rock garden, dancing fountains and sculptures. Since the Bangkok Metropolitan Administration (BMA) is more qualified and ready in terms of budget, staff, and equipment to maintain the park, on 12 September 1995, the Treasury Department proposed that the cabinet transfer the park to the care of the BMA. Subsequently, the cabinet approved the Treasury Department’s request to transfer Benjasiri Park to the care of the BMA from May 4, 1996.
3. Benchakitti Park
On 28 May 1999, the cabinet reiterated its approval of its decision of 17 October 1998. about the relocation of two factories belonging to Thailand Tobacco Monopoly—Factory 6, relocated to a State Property in Don Chimplee Subdistrict, Bang Nam Priao District, Chachoengsao Province, and Factory 7, relocated to Thailand Tobacco Monopoly-owned land in Mae Jo Subdistrict, San Sai District, Chiangmai Province. The Ministry of Finance therefore transformed the old plot in the Khlong Toei area to a large public park to be dedicated to Queen Sirikit on the occasion of Her Majesty’s fifth-decade birthday. The park was named “Benchakitti” by Her Majesty. The development of the park was a royal-inspired project to improve life and the quality of the environment by using State Property. The park features an open-air green area, containing luscious dense groves of trees, a water park, a health and fitness area, a working-out area, a rare-plant garden and a plants-in-literature garden. The project started during the 1997 fiscal year with a budget of 180 million baht (from profits made by Thailand Tobacco Monopoly) used for thedesign and the construction. The first phase of the construction will be finished in the 2000 fiscal year.
4. Stadiums and Public Parks
The Ministry of Defense returned a State Property with an area of 30 rai 80 square wah,1 around the Kiak Kai intersection, Taharn Road, Dusit District, Bangkok, to the Ministry of Finance. The property had been the site of a textile factory belonging to the Ministry of Defense. The Ministry of Finance transferred the property to the Bangkok Metropolitan Administration for construction of a stadium and public park, as part of project honoring HM
5. Projects for the Construction of Community Public Parks
The Treasury Department supports governmental units and local administrative organisations by using State Property to build community public parks around the country due to the cabinet’s approval dated 19 September 1995, allowing the Ministry of Finance, through the Treasury Department, to consider using State Property to build public parks. The objectives are to use the property for recreation and other worthwhile public activities, to improve the quality of life and the health of the population, to increase the number of green areas throughout the country, and to restore the environment. The Treasury Department hence has carried out several projects to construct small, medium and large public parks on State Properties. In addition, the Treasury Department works in collaboration with other governmental units and local administrative organisations to use State lands for projects with social and environmental benefits.
6. Projects for Using State Property for Religious Purposes
The Treasury Department allows the use of State Property for religious purposes, such as servings as locations for temples, mosques and churches for all religions.In order to develop the State Property, increase revenue, and enhance the value of national assets, the government has issued the asset-based economic policy as necessary. Therefore, the Treasury Department, as the unit responsible for governing, overseeing, maintaining, and administering State Property, which is a valuable asset that can serve as a resource for the economic development of the country, has developed a new profit enhancement system for State Property and has set up a project for the use of State Property to generate income and increase the value of the assets.
1. To administer State Property so as to create maximum benefit
2. To generate more income for the government and increase the value of the assets
To establish plans to increase benefits derived from State Property by generating 20,000 million baht in income for the government.
To enhance the value of the national assets which make up State Property by 65,00o0 million baht in the five years starting in 2002, according to the State Property development project.