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Farmers still need income support, says Kittiratt

Aug 20. 2017
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KITTIRATT NA RANONG, former deputy premier and finance minister of the previous Yingluck government, yesterday told a Thammasat University seminar that he should have spent more time explaining the merits of the rice-pledging scheme while in office.

At the seminar, titled “What are the other options if not the rice-pledging scheme?” Kittiratt insisted the rice-pledging scheme was a sound policy aimed at helping low-income farmers and their 15 million family members nationwide.

Kittiratt was speaking at the event as former premier Yingluck awaits a Supreme Court verdict on Friday about alleged negligence of official duty while overseeing the rice-pledging scheme, which prosecutors charge resulted in corruption and massive financial damage to the state. “If I could go back in time, I would have spent much less time on other works but would have focussed on explaining this [rice-pledging] scheme so as to fight the current political narrative,” he said.

According to the former finance minister, Thailand was capable of allocating financial resources to help low-income earners in both urban and rural farm areas. He quipped that the country also had financial resources to buy military hardware such as submarines, as all decisions rested with the ruling leadership.

Farmers and their families total 15 million people and account for 23 per cent of Thailand’s overall population, so the government needs to ensure that their livelihoods are improved, Kittiratt said.

The Yungluck rice-pledging policy was not the first time that such programmes, including income guarantees and related measures, had targeted farmers, he said. These approaches had been used for the past three decades and were also vulnerable to problems. For example, it was difficult to prove whether farmers actually planted rice fields if they had already successfully registered to get state compensation under an income guarantee programme.

He said the Yingluck government therefore turned to the massive rice-pledging scheme, since it required evidence of rice paddies to get state benefits under the programme.

Defending the high pledging price, Kittiratt said farmers need to be compensated significantly. Even with the high pledging price for rice offered by the government, farmers’ income was still less than that of people working in urban areas, he said. Under the pledging programme, the government paid about double the market price for rice.

Kittiratt said the National Economic and Social Development Board had sent a letter to the Yingluck government confirming that farmers’ income had improved because of the rice-pledging scheme. “The scheme was not aimed at benefits for the prime minister, as it was designed as part of the Pheu Thai party’s election campaign. When it was said the state suffered a big financial loss [due to the high pledging price], that could be called an accounting loss. But in terms of public policy, it could be said that the state revenue is just lower than the state expenditure.

“In other words, farmers get higher income from the scheme [even though the state had to set a budget to cover the price difference]. The benefit is that farmers have more income so they have purchasing power to boost the economy, and in the end the overall benefits are greater than the subsidy budget,” he said.

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