The Integrated Appraisal Framework of Rural Road Improvement Projects

Abstract

The government policy for Thailand to be a logistics and transportation hub presents challenges to the Department of Rural Roads (DRR). The Bureau of Rural Roads (BRR) 11, 12, and 14 as the subsidiaries of the DRR have been enforced to reform their methods of appraising rural road improvement projects.  Multi-criteria decision-making (MCDM) was first developed but was found to be inappropriate within the fiscal constraints since it was not based on monetary terms. This paper explores the DRR’s attempts to overcome this problem. The DRR conducts a Benefit-Cost Analysis (BCA) to filter the improvement projects prioritized under the MCDM approach. While calculation is not a problem under BCA, the method cannot be readily adapted to incorporate all relevant parameters particularly those relating to the social benefits of road improvement projects. These parameters are important in the Thai context and compatible with the characteristics of rural roads. The findings reported demonstrate that the incorporation of factors taken into account in MCDM but overlooked in traditional BCA is currently impracticable in view of the lack information and difficulty of expressing those parameters in monetary terms. The paper discusses supplementing the DRR’s improvement project appraisal process by BCA methods thus enhancing the effective and transparent allocation of the DRR’s budget, while simultaneously providing regional benefits.