Subsidy for elderly faces FPO rethink

Subsidy for elderly faces FPO rethink

Adjustment could save state B10bn a year

The Fiscal Policy Office (FPO) is considering reviewing the blanket living allowance for the elderly in order to cease paying the subsidy to those with sufficient income and reallocating this portion to others.

The proposal is aimed at paying a higher living allowance to those whose income is not enough to lead a comfortable post-retirement life, Krisada Chinavicharana, director-general of the FPO, said.

Giving senior citizens a higher living allowance is the focus of the planned adjustment to the subsidy, he said, adding that the government's budget is not the main source of providing the living allowance to elderly people.

Deputy Finance Minister Wisudhi Srisuphan recently said the government could mandate that only senior citizens with a monthly income of less than 9,000 baht and assets valued below 3 million baht would qualify for the regular subsidy.

An adjustment to the social welfare system for the elderly and a soon-to-be-implemented module under the national e-payment system that allows the government to directly subsidise senior citizens are projected to help save the state 10 billion baht a year, he said.

The living allowance for senior citizens was initiated in 1992, starting at 200 baht per person per month before rising to 500 baht in 2003, but the subsidy was limited to those whose income was deemed insufficient to meet living costs.

The subsidy was tweaked again and the blanket offering was re-implemented in 2010.

The Yingluck Shinawatra administration later adopted a step-up subsidy, with a monthly 600 baht paid to those aged 60-69, 700 baht to those aged 70-79, 800 baht to those aged 80-89, and 1,000 to those 90 and older.

A recent FPO study found that Thailand entered into an ageing society in 2007 and elderly people accounted for 14% of the total population in 2015. The Finance Ministry's think tank also forecast that the country will become an aged society in the next decade.

A society is considered to be ageing when one-tenth of its population is aged above 60, and aged when one-fifth is aged above 60, according to the United Nation's definition.

At present, the government gives a living allowance to 7.8 million elderly people, while 2.02 million state officials have a pension fund and another 11.5 million are registered with the Social Security Fund.

Members of the Government Pension Fund, which matches contributions between members and the government, has 970,000 members, and another 2.9 million are members of provident funds.

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