FACTORS INFLUENCING THE DIFFERENCE BETWEEN WINNING BID PRICES AND CONSTRUCTIONS ‘FOCAL PRICES UNDER THE COMPTROLLER GENERAL’S DEPARTMENT: A CASE STUDY OF ROAD CONSTRUCTION

Abstract

Abstract

      The study’s objective is to analyse the relationship between the government construction projects’ winning bid price and focal price which is calculated by the focal price calculation system. This study employed secondary data from the electronic government procurement under the Comptroller General’s Department over the fiscal years of 2018-2020. All 33,665 road construction projects used in this study were selected from the project’s budget ranging between 2-20 million baht from five different departments: Department of Public Works and Town and Country Planning, Department of Highways, Department of Rural Roads, The Royal Irrigation Department, and Department of Local Administration. The data were analysed by pooled regression model. The dependent variable is the difference in percentage between the winning bid price and focal price, which is divided into 4 models: (1) all projects, (2) projects that the winning bid price is higher than the focal price, (3) projects that the winning bid price is lower than the focal price, (4) projects that the difference between the winning bid price and focal price is higher than 15 percent.

The results show that there are 1,475 projects which their winning bid prices are higher than those focal prices. Moreover, there are 32,180 projects that their differences between the winning bid price and focal price are more than 15 percent. The factors influencing the difference in percentage between construction’s focal price, calculated by the focal calculation system, consist of the number of bidders, high intensity rainfall, construction time, diesel price, factor F, fiscal years, and departments. These factors are statistically significant over 0.10 level on ceteris paribus. According to the results, the Comptroller General’s Department should keep up to date with the factors that affect construction’s focal price.