Pridiyathorn writes to PM opposing rice pledging
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MR Pridiyathorn Devakula has written an open letter to Prime Minister Yingluck Shinawatra, urging her to stop rice-pledging scheme and turn to use margin paying method.
Prime Minister Yingluck Shinawatra Tuesday said that she has not yet been informed of the letter, which contains the estimated losses of at least Bt425 billion in the first two years.
"The Commerce Minister will explain this. We still have to wait for the official figures. For today, related ministries are finalising the figures."
15 October 2013
Dear Prime Minister,
As a Thai citizen, I have been monitoring the progress of the rice-pledging with concern that it will cause huge damage to the national budget and will provide a chance for massive corruption. From information announced by government agencies and from information of private rice traders as well as from my own surveys of farmers, the rice-pledging scheme during the past two years could be summed up as following:
|
2011/12 |
2012/13 |
Total |
|
|
Amount of rice bought (tonne) |
21,640,000 |
22,230,000 |
48,870,000 |
|
Amount of rice, the government paid market margin to farmers |
- |
890,000 |
890,000 |
|
Amount of damage up to the day rice is totally sold (million baht) |
at least 205,000 |
at least 230,000 |
at least 425,000 |
|
Benefits of market margin paid to farmers |
103,277 |
106,849 |
210,126 |
|
Benefit earned by others who are not farmers |
56,967 |
58,864 |
115,831 |
|
Number of families under the scheme |
2,163,300* |
2,108,000* |
|
|
Number of families not paid under the scheme |
1,839,000 |
1,894,000 |
The information I have presented above was calculated based on facts that can be verified with information of government agencies. Figures from the government committee in charge of summing up the rice-pledging data also underlined the figures of losses of the project.
When the scheme started in October 2011, the prime minister might not expect that the project would have caused so huge losses. Just in two years, the government has already suffered losses worth Bt425 billion while the benefits earned by farmers were less than half of the losses. Still, non-farmers have abused loopholes to siphon and reap benefits from the scheme for Bt110 billion during the past two years. Time has proved that government officials could not prevent corruption in the scheme.
Now that you have learned the information, if you, the prime minister, still listen to the persons around you and allow the scheme to go on for another year (2013/14), it would mean that you are tolerating the country’s administration that causes huge damage to the national budget although you know the damage will happen.
I understand well that you want to help increase incomes for farmers. But you should find a way to help farmers that will not cause higher losses to the national budget than the benefits that the farmers will receive more than market prices. Such a measure should not provide a chance to non-farmers to cite farmers to reap their own benefits. Such a measure should spread benefits to more poor farmer families. Moreover, to prevent damage from rice becoming rotten, the government should find a way to help farmers without bringing in rice to be in the government’s stockpile. On the contrary, the government should allow rice to be traded through the rice trading system of private firms, which is already good and will not cause damages to the government.
Actually, your government has already started using such a measure for helping farmers without causing huge damage. The measure was used in case of rubber growers. Your government decided to pay only the market margin directly to rubber growers to prevent others from earning benefits. The measure allowed the rubber trading system to continue normally without taking in rubber sheets to be in the government’s stockpile, which could lead to losses or corruption when the rubber stocks are unloaded. Moreover, the Commerce Ministry has already used this method in providing help to formers for 890,000 tonnes of rice, which was the last amount the government provided help to farmers for the 2012/13 crop year. The Commerce Ministry paid the subsidy directly to bank accounts of farmers at the rate of Bt2,500 per tonne, instead of buying the rice from them at the rate of Bt15,000 per tonne.
As a result, I would like to call on the prime minister to seriously review the scheme. It is still not too late to cancel the rice pledging scheme and turn to use the method of paying the subsidy for the market margin directly to farmers. The government must set the ceiling of subsidy for each family and must formulate rules to fairly distribute subsides to poor farmers. If you, the prime minister, can do this, you will earn the praise that you have worked as the prime minister to prevent the national budget from being wasted and you will also help more farmers.
Sincerely yours,
MR Pridiyathorn Devakula
