7th Seminar of Institute for Comparative Studies in Local Governance (COSLOG) Graduate Institute of Policy Studies (GRIPS), Tokyo, JAPAN on March 17, 2009

The Effect of Decentralization on City of : Transitional period from Mechanical Politics to Good Governance Achakorn Wongpreedee GSPA , NIDA, , Thailand [email protected] 1

Outline 1. Decentralization and local government in Thailand (1992 -2008) 2. The Effect of Decentralization on 2.1 Local Authorities, Local Personnel, and Local Finance 2.2 Structure of political power in a 2.3 City ’ s management (Case study of Phitsanulok City) 3. Argument 2

1 1. Decentralization and local government in Thailand (1992 -2008)

3

Decentralization in Thailand during 1992 – 2007

1992 1994 1997 1999 2000 2007 Bloody May Incident

TAO law constitution Decentralization Act of 1999 -Direct election of all local administrators -Promote “Good Governance”

Constitution4

2 Before decentralization Prime Minister People The cabinet elect Ministries MP

Departments ex-officio Provincial Administrative control chiefs Organizations (PAO) chiefs Municipalities Village chiefs Sanitary ex-officio

= Central government

= Local government organizations (LGOs) 5

After decentralization Prime Minister People elect The cabinets elect MP elect Ministries elect

Departments Governor Provincial Administrative Organizations District chiefs (PAO)

Tambon chiefs Municipalities Village chiefs Tambon Administrative Organization (TAOs)

= Central government

= Local government organizations (LGOs) 6

3 Number of Local Government Organizations in 2008

Local government organizations Number

1. Provincial Administrative Organization (PAO) 75 2. 1,162 - City municipality (Big urban city) 22 - Town municipality (Medium urban city) 120 - Tambon municipality (Small urbal City) 1,020 3. Tambon Administrative Organization (TAO) 6,616 (Rural) 4. (Special big urban city) 1 5. Bangkok (Metropolis) 1 Total (September 11, 2008) 7,855

Source: http://www.local.moi.go.th/local_sub2 .htm (accessed September 19, 2008) 7

2. 1 The Effect of Decentralization on

2.1.1 Local Authorities 2.2.2 Local Personnel 2.3.3 Local Finance

8

4 2.1.1 Decentralization of authority

1. Provision of fundamental infrastructure 2. Quality of life enhancement 3. Community organization and A school was transferred to be peace keeping under a control of PAO : Aug 2006 Buri Ram 4. Planning and promoting investment, trade and 5. Management and preservation of natural resources and environment:

A provincial bus terminal was transferred to 9 be under Municipality : Sep 2005 Buri Ram 」」」

2.1.2 Decentralization of personnel Number of local government officials, 1995 and 2004

Category of Thai 1995 2004 Increase percent bureaucracy

Total local officials 57,115 100,208 43,093 75

Bangkok Metropolitan 30,063 31,409 1,346 5 Administration (BMA) Provincial Administrative 27,052 68,7 99 41,747 154 Organizations (PAO), Tambon Administrative Organizations . (TAO), Municipalities

Source:http://www.local.moi.go.th/civil%20service%20taskforce.pdf (September 29, 2006) for FY2004, and Anek Laothammatas (2002) Hetyuti thongthin: panha kanmuang kanpokkrong radapchat thi mi sahet machak kanpokkrong thongthin thi mai phiangpho (Bangkok: Sun suksa lae phattana thongthin) P.7-8 for FY1995 10

5 Number of LGOs and local personnel in 2006

No of General Teachers Employees Total LGOs officials

PAOs 75 5,639 - 2,647 8,286

Municipals (include Pattaya 1,159 23,368 13,731 16,572 53,671 City)

TAOs 6,620 26,061 - 8,586 34,647

Bangkok Metropolitan 1 18,040 13,369 34,303 65,712 Authority (BMA)

Total 7,855 73,108 27,100 62,108 162,316

Source: http://www.local.moi.go.th/local_sub5 .htm (September 24, 2006) 11

Number of LGOs and actual number of executives and councilors (except Bangkok and Pattaya) (on March 1, 2006)

Provincial Municipalities Tambon Administrative Total Provinces Administrative (Cities- Urban area) Organizations (TAOs) Organizations (PAOs) (Rural area)

Exe coun Total Exec council Total Execu councilor Total cuti cilors utive ors tives s ves s

1. Buri 9 42 51 43 285 328 183 4,932 5,115 5,494 Ram

2. Pathum 8 30 38 22 193 215 118 792 910 1,163 Thani

Other 73 ...... provinces

Total 619 2,250 2,869 1,974 13,582 15,556 7,835 140,545 148,380 166,805 75 provinces

Source: Data from Bureau of Local Personnel System Development, DOLA 12

6 2.1.3 Fiscal decentralization Proportion of LGOs revenues and National revenues (million baht) Fiscal Year LGOs revenue National revenues LGOs % of total 1996 60,663 850,458 7.13 1997 93,349 843,542 11.07 1998 103,604 733,136 14.13 1999 105,036 708,826 14.82 2000 99,802 749,948 13.31 2001 154,633 739,021 20.92 2002 176,803 803,651 22.00 2003 184,066 829,495 22.19 2004 208,851 928,100 22.50 2005 293,750 1,250,000 23.50 2006 327,113 1,360,000 24.05 2007 357,424 1,420,000 25.17 2008 376,740 1,495,000 25.20 13 Source: Ministry of Interior for FY 1996-2005 and FY 2006-2008 from Fiscal policy, Ministry of Finance

Figure 3: Revenue of LGOs, FY 1998-2005 (million baht)

70000 60000 50000 PAOs Municipalities 40000 TAOs 30000 Pattaya 20000 Bangkok 10000 0 1998 1999 2000 2001 2002 2003 2004 2005 14

7 Current problems of decentralization Problems between the Internal problems among LGOs and the central LGOs administration 1.Corruption, and 1.Strong resistance from certain sections competition for benefits of central 2.Imbalance in number of bureaucracy politicians and local staff 2.Fiscal decentralization 3.PAO large budget but failed to meet the light workload target of channeling (comparing with other 35 percent of public LGOs) revenues

15

Conclusion 1 LGOs have achieved considerable autonomy through

1.TAO Act of 1994 Decentralization of 2.Constitution of 1997 authorities, personnel, 3.Decentralization Act and budget to LGOs of 1999 4.Constitution of 2007

16

8 2. The Effect of Decentralization on

2.2 Structure of political power in a

17

Electoral performance of PAO chairman candidates, by candidate type (2006-2007)

New Former MPs and Local politicians* candidates relatives Region run elected run elected run elected Central 51 0 13 2 52 24 Northeaste 55 0 13 5 35 14 rn North 18 0 8 4 40 12 South 9 0 6 3 33 11 Total 133 0 40 14 160 61 Percent of 39.94% - 12.01% - 48.05% - the candidates (from 333 persons) Percent - 0% - 18.67% - 81.33% elected (from 75 persons) 18 * All local politicians elected are nominees of the MPs

9 Implication of the table

Assumption of academics Decentralization will provide new local politicians with an opportunity to become LGOs through direct election

But……in fact…..

1) Not a single newcomer (0%) was elected 2) Former MPs/relatives and their related local politics before decentralization era occupied all seats.

19

Reasons why influential family won

1. Experience in election 2. Local networks 3. Money 4. Controlling the Provincial Election Commission

20

10 Relationship between MPs (national politicians) and local politicians

1.Relatives, seniors and subordinates, friends 2.Exchanges of interests (reciprocal relationships) •money, projects, votes, budget, other kinds of interests etc.

MPs PAO chairman National politicians City mayor TAO TAO Mayor 1 Mayor 2 Local politicians 21

Conclusion 2

1. MPs can control the powerful chiefs of LGOs 2. MPs can retain their influence by exploiting new opportunities after decentralization 3. Almost all of LGOs (PAO, Municipality, TAO) are Relatives, seniors and subordinates, friends or exchanges of interests (reciprocal relationships) money, projects, votes, budget, other kinds of interests etc.

22

11 Argument 1 (Conclusion 1+2)

► Even though decentralization caused changes in the legal and organizational structure (Decentralization of authorities, personnel, and budget to LGOs) ; it had very little effect on the power structure in the provinces. The MPs of the pre -decentralization era have increased their power and further entrenched themselves mainly through their preeminent ability to win a large portion of the vote.

23

2. The Effect of Decentralization on the Phitsanulok City, Phitsunulok Province

24

12 Phitsanulok City – The Place

►Located in , 337 km. north of Bangkok ►nearly 29,000 households or 90,386 people, ►an average annual income of Baht 43,000 ►The city jurisdiction about 18.26 sq.km . ►The city rapid urbanization and economic growth in the 1990s. ►6 adjacent local government authorities called Tambon Administrative Organizations (TAOs ). 25

Phitsanulok City ► a hub of Thailand ’s Lower -North Region ► an educational center, it was the home base of three leading higher -educational institutes ► The corresponding demand effect on goods and services from in -migrants in sectors ranging from housing and apartments, to various kinds of commercial shops, to regional government offices (inclusive of the military (army) bases) ► Bustling and expanding activity in these and other fields continued to attract an increasing influx of number of highly -educated people. ► a major transportation center linking the nearby provinces and the center (Bangkok) with the Upper - North provinces ( , , and Nan) by national highway, railway, and air transportation grids. ► a vibrant medium -size municipality “on the move. ” 26

13 City administrati ve structure

► Legislative  24 Municipal Councilors (directly elected from people) ► Executive  a mayor (directly elected from people) ► Permanent officials  a city clerk, municipal officials, and employees. ► There are municipality officials and is divided into 8 divisions:  Office of City Clerk Office  Public Work Bureau  Education Bureau  Technical services and planning division  Public Health and Environment Division  Finance Division  Water Supply Division  Social Welfare Division 27

City officials and People ► 235 common municipal official civil servants, ► 148 permanent employees, ► 569 temporary employees. ► the city administered five municipal schools, enrolling nearly 3,600 students and employing about 156 teachers. ► 90,386 people, 59,946 voters ► Density of population is about 4,949 persons/ sq.km (an urban society). ► The settlers earning in small -and medium -size businesses, small - and medium - size enterprises,

companies, stores, commerce etc. 28

14 Good Governance Awards of Phitsanulok City and the Mayor

29

Awards in a field of administration and management

► “Good Governance Awards for of Local Authority ” granted by the Department of Local Administration and the Commission of Decentralization (1994, 1995, 1996) ► “King Prajadhipok ’s Institute (KPI) awards (or KPI awards) ” granted by King Prajadhipok ’s Institute (1992, 1994, 1996) ► “A golden KPI Award ” which is exclusively granted to the already -awarded local authorities for three consecutive years (1996) ► “Sustainable Lively municipality Award ” which contested among the biggest municipalities throughout Thailand (2005) ► Good Image for the quality of the services (2006) 30

15 Awards in a field of Environment ► “PCD award for solid waste management ” granted by Department of Pollution Controls , Ministry of Science, Technology and Environment (2001, 2003) ► “Clean fresh market award ” and “Lively Municipality Award ” granted by Department of Hygiene, Ministry of Public Health (2001, 2003) ► “Cleanness and tidiness award ” granted by Department of Provincial Administration, Ministry of Interiors and the municipality leagu e of Thailand (2002) ► “An award for a contest of energy saving campaign ” granted by Department of Provincial Administration, Ministry of Interiors a nd the municipality league of Thailand (2003) ► An award of excellence in environment management from municipal slaughterhouse granted by Bureau of Energy Policy and the Government Saving Bank ’s city development fund. (2004) ► A cleanliness award of public toilets granted by Department of Hygiene, Ministry of Public Health ► An award for local authority with excellent environment management granted by Thai Health Promotion Foundation

31

Awards in a field of education

► An award for excellent municipal school granted by the Teacher ’s council of Thailand and the office of provincial public health ► An award for excellent municipal school granted by the department of local administration ► An award for a municipal school ’ s a pilot project for a child -centered teaching system ► An bestowed award by the King of Thailand for a small -sized secondary municipal school

32

16 Awards in a field of disaster prevention and mitigation ► An award for disaster prevention and mitigation project contest granted by the municipal league of Thailand in cooperation with department of provincial administration (1997, 1998, 1999, 2000) ► An excellence in flood prevention project from the Government Saving Bank ’s city development fund (2004)

33

Awards in a field of Finance

► Local authorities with excellent attempting in tax collection ► (Prize money amount 16.62 million ) (2003) ► Local authorities with excellent attempting in tax collection (2004, 2005)

34

17 Many others

►the municipality also received other specific awards evaluated by other public organizations; such as Ministry of Health, the Office of Public Service Development Commission, which excludes a large number of awards at the regional, provincial and local awards organized by different public and private sectors. Thus, in terms of local management the mayor is undoubtedly one of great local executives.

35

Phitsanulok Province and the origin of “Champhunod ” Family (Influential family in Phitsanulok ) 1. Mr. Sakchai Champhunod - commerce and small -scaled industry; i.e. grocery, Thai -siwalak ice factory, and Charoen Panit Mill Industry - elected as many social organizations in Phitsanulok ; i.e., a president of the Chinese association of Phitsanulok , a president of committees of Sin -ming Chinese school, a president of committees of Chinese cemetery 36

18 2. Mr. Suchon Champhunod , a son of Sukchai Champhunod ►the family enjoyed the most widespread patronage network in the Province and Municipality ►elected as councilors of Phitsanulok City, and then he was selected by among elected councilors to be a mayor of Phitsanulok City ►A successful businessman with a variety of business interests ranging from a real estate and land developer (many projects, a private vocational school, two luxury 37 cinemas to a five -star hotel and a resort.

Mr.Suchon and his political arena

►First elected as a Member of Parliament representing Phitsanulok in 1979, he easily won re -election multiple times thereafter – i.e., 1983, 1986, 1988, September 1992, 1995, 1996, and 2006. ►Deputy minister of finance ►Minister of university affairs ►Minister of the Prime Minister ’s Office

38

19 3. Ms. Premrudee Champhunod , wife of Mr. Suchon Champhunod ►Premrudee Champhunod , who first ran for mayor of Phitsanulok City in 1995 and was thereafter re -elected to three, 4-year terms in office. (four terms =16 years) ► Mayor of the city from 1995 -2010)

39

Mayor Premrudee and the City

►Thailand ’s longest -serving mayor began toward the end of 1994 ►a group of similarly minded friends, who shared here disquiet about the state of local politics, gathered to establish the Luk Naraesuan Group and stand together as candidates for election to the Phitsanulok City Councilors.

40

20 Premrudee ’s Governing Philosophies and Techniques ► “Once I decided to set my political group for the municipal election, I therefore selected only the [most] promising candidates – [those who] seriously intend[ed ] and [were] ready to work industriously for the Municipality. I . . . tried my best to select members of my political team [who brought the] three [desired] backgrounds – namely, family, knowledge, and public minds. [i ]” ► [i] Interview with the mayor Premrudee Champhunod at her residence in Phitsanulok on December 23, 2007

41

► “[In] my first term as mayor, my image as a female politician and the wife of the provincial member of Parliament was not so good in the perception of the people. Therefore, I [had] to prove myself – [show] that I seriously and sincerely intended to develop my hometown, which still lagged behind, compared to other municipalities. One important thing, among many other ways to prove my capability and intentions, was the award system [initiated by] outside organizations that could [lead to] grants valuable enough to [enable us] to make a great impact [in terms of] promot[ing ] speedy municipal development and my team ’s capabilities concurrently. [i ]”

► [i] Interview with the mayor Premrudee Champhunod at her residence in Phitsanulok on December 23, 2007 42

21 ► Premrudee allowed that, as team leader and the person with “the strongest leadership [skills] among the 18 Municipal councilors, she had to “think in a different way to utilize all of [her] business managerial skills to develop new innovations and to apply them to municipal administration .”[i ] From the outset of her first administration, and continuing into her two successive administrations, a certain philosophy of governance informed her approach to the oftentimes daunting task of leading a city government and getting things done. She explained: ► [i] Interview with the mayor Premrudee Champhunod at her residence in Phitsanulok on December 23, 2007 43

► . . . In taking care of all 51 communities ’ leaders within the municipal area, I always realize that it is . . . most important to make them pleased and . . . dedicated to the work and activities of the municipality. Honestly speaking, sometimes I have to invest some of my [own] money to treat the people to a feast, and to apply some of my prominence and social connections to take good care of them – which in my opinion I do not think . . . is wrong - doing at all. Ideally, local politicians in [the] decentralization era must be broad -minded [and] dedicate their own happiness to the people. I am open -minded enough [such that] if there will be other local politicians with high potential who sincerely take good care of the communities ’ leaders and vote canvassers as effectively and efficiently as I do, . . .[or] can serve the communities ’ leaders better than me – [then] I am strongly sure that they also could be elected to sit in the mayor ’s post without difficulty. Then, I [would be] ready to retire myself from local politics right away .[i ] ► [i] Interview with the mayor Premrudee Champhunod at her residence in Phitsanulok on December 23, 2007 44

22 ► To some interested observers, Mayor Premrudee seemed to be a practitioner of the quid pro quo style of governance, making sure that communities loyal to her were rewarded with official assistance, while perhaps being less attentive to the entreaties of those whose loyalty lay elsewhere. This approach to governance not only enabled her to accomplish many of her first - term objectives, but also won her widespread accolades from a majority of the voters who, regarding her as an exceptionally responsive and generous politician, returned her Luk Naraesuan Group to office for a second, third, and fourth 4 - year terms in 1999, 2003, and 2007, respectively. And, the Group, in turn, dutifully, re -appointed Mrs. Premrudee as mayor on each occasion. 45

Oversea Support to Phitsanulok City under Mayor Premrudee ’ s management ► ------► Organization Issue Support ► ------► MOCI Development strategies ► (Ministry of Construction of Japan) ► And World Bank ► ------► GTZ Solid Waste Management ► (German Technical Cooperation Agency) ► ------► UN -ESCAP Environment Management ► ------► LOGODEF Information Management and ► (Local Government Development Syst em Development ► Foundation) and ► Konrad Adenauer Stiftung ► ------► UNICEF Education ► ------► FCM Municipal development ► (Federation of Canadian Municipalities) ► ------► Source: Division of Technical Services, Phitsanulok Municipality (2005)

46

23 Phitsanulok 県 is not a too specific case study in Thailand, but the similar situation (, which influential family of MPs during pre- decentralization age are capable of extending their political network into the LGOs ,) happen almost all 75 .

A short brief of two other cases: 県 and 県 47

MP-c1 Senator Senator MP-c2 MP-c3 MP-c4 CPP 1 2 DP TRT TRT

Mr.Chan Poungpet , 46 years Mr.Poonsawat Hansawat , 36 years Farmer  -selling business nephew of Hansawat family  Tambon headman PAO councilor PAO councilor ex-PAO mayor

Kukot M. M. Taklong M. Bangkradi M. mayor mayor mayor mayor MP-party-list TRT Kukot TAO. Other Municipalities and Sananrak M. mayor TAO mayors mayor Muang M. mayor 48

24 An Influential family in Buri Ram 県

結婚

Father : MP  Senator Son : MP  minister Daughter in law : ->Parliament President Businesswoman  MP -> ->powerful 派閥 leader in Thailand’s politics PAO chairman(2007-present)

結婚

Son : Daughter : Son in law :  Government Banker  Senator Police officer PAO chairman Officials (2003-2007) 49  MP -> advisor to Minister of Interior

An influential family’s close friends

Friend of father: Friend of son: A provincial governor A chairman of provincial election commission

Friend of son: teacher Friend of son: local leader + canvasser  MP 50 + businessman MP (Minister of transportation)

25 Election Commission and political neutrality Before the 1997 constitution After the constitution Ministry of Interiors Election commission (EC)

- EC is an independent organization to secure political neutrality, free, fair and honest elections - EC has two levels; National EC and provincial EC

Political neutrality

1) National EC fair ! (Due to mass media and people’s observation)

2) Provincial EC very bad! (because MPs can interfere easily) 51

MP’s interference in Provincial EC

A selection process of Provincial EC National EC propose 1. nominate appoint

8x3=24 nominees 5 commissioners 8 Selection + directly apply 15 nominees of PEC commissions candidates

2. block vote

At least 5 in 8 persons

MP’s interference 52

26 Maintaining political capital at the local Level

Birthday Party treats the people of the province to a feast Providing water to the villages where water was scarce Fulfill the dream of parents for their children’s admission to a famous school Fulfill the wishes of provincial officials to promotion, transferring, rewording Grant money and things for the public goods and services such as school, temples, police patrol vehicles, ambulances, women and elder groups, NGOs, disabilities, the poor etc.

The source of money come from…. Before decentralization  the personal money from (investment to be elected) After decentralization  National budget or LGOs’ budget (taxes) 53

3.3. ArgumentsArguments

54

27 Four main arguments 1. Although decentralization cannot make a significant change in power structure in the province, it can indirectly shape a managerial behavior of a city mayor to adopt professional standard required by a concept of good governance.

55

►2. Local government in Thailand after decentralization age has still been in a transitional period from a style of mechanical politics to good governance. Although almost all city mayor comes from supports of influential family in a province (patterns of mechanical politics before decentralization), they have to pay attentions and take a good care of their people than before.

56

28 3. Comparative issue

Japan longer experiences; central government could not be in a position to evaluate local government. Central government = Local government (full local autonomy) Thailand LGOs compete for awards  for 1) good image of both leaders and local govenrments , 2) To gain higher votes, higher money (prize, awards) from central government and may leading to 3) local development Transitional period: even they came to local power by using money and cliques, but they have to show their capabilities in working concretely by a number and quality of awards

57

4. Retained central budget for award as incentives = Retain Vertical relationships between central and local ?

100%

36% 38% 39% 46% 44% 39% 39%

19% 8% 11% 18% 17% 19% 18%

35% 33% 33% 34% 34% 34% 34%

11% 12% 12% 10% 10% 9% 9% 0% 2001 2002 2003 2004 2005 2006 2007 Fiscal Year

Locally Levied Taxes Centrally Collected Taxes Shared Taxes Grants 58

29 4. Therefore, in the future, Thailand ’s central government should not try to control over local government organizations by employing a “disguised ” award system with some money prizes from centrally collected taxes as incentives. The central government would rather gave a “real ” fiscal autonomy to the local government organizations by increasing a kind of local levied taxes over than centrally collected taxes, and shared taxes as ever did during past decade. 59

Policy recommendations ► Central government should not try to control local government by deciding their own criteria to evaluate the local government. It represents a form of “disguised vertical controlling ” by using awarding system. ► In contrast, central government should allow full local autonomy to local government. Their relationships should be a horizontal relationships. ► Local government should have their own autonomy to decide what their people need by themselves , especially fiscal autonomy enough to function their local authorities . ► Powerful family in the province is just a transitional periods of decentralization. It is normal phenomena, it will be dissolved in the next few elections in the future. However, the Thai states should reconsider how to make the Election Commission being more free and fair from political interferences so that they can organize a free and fair election enough to have new young blood politicians as a national and local politicians in the future. 60

30