More than a dozen rice-pledging schemes since 2004 have cost the country 682 billion baht, but about 76% of those losses were caused by the previous government’s four programmes, the Finance Ministry said.
A farmer in Kong Krailas district of Sukhothai province harvests rice after her field was flooded in September 2014. (Photo by Pattarapong Chatpattarasill)
Permanent secretary for finance Rangsan Sriworasart told a press conference Thursday that a subcommittee reviewing balance sheets for 15 rice-pledging schemes run between 2004 and May 22, 2014 calculated a total loss of 682 billion baht.
The ministry said the first 11 projects resulted in a loss of 163 billion baht, but the final four projects implemented by the Yingluck Shinawatra government generated a loss of 518 billion baht, or about 75.9% of the total.
During the 2011 election, the Pheu Thai Party initially promised to give farmers 15,000 baht per tonne of unmilled white rice with no limit on pledged amounts. The campaign pledge brought victory to the party and fugitive ex-premier Thaksin Shinawatra's youngest sister, who was appointed prime minister.
While limits and price changes were introduced in later stages of the programme, the four stages combined bought in a total 85 million tonnes of unmilled rice for 1.1 trillion baht. There are 19.2 million tonnes of rice remaining, worth approximately 225 billion baht. The country got 347 billion baht from sales of rice in the stock.
The subcommittee found that the rice pledged under Ms Yingluck's programme had 10%-40% rates of deterioration and the government still has to pay other expenses, including warehouse rent, milling, management fees and interest.
He said the account-closing for rice-pledging scheme had been carried out under proper accounting standards and audited by the professional council and the Comptroller General's Department. However, it has not taken into account the result of any stock-checking, which has been done by the National Rice Policy Committee.
Mr Rangsan said the subcommittee would report account-closing details to the NRPC and await further instruction.
The subcommittee said the rice scheme's balance sheet will run through Sept 30, the end of the 2014 fiscal year. Then the government can set aside funds to repay the Bank for Agriculture and Agricultural Cooperative, which is responsible for paying farmers for pledged grain.
He said losses might be higher if the NRPC instructed the Finance Ministry to combine the loss incurred by stock-checking. The loss will also depend on the selling price and quality of rice in the stock.
"The amount of loss is not beyond expectations. The government may have to find a method to pay the debt without causing problems to the country's development and public-debt position. It may take too long time to rely solely on budget allocations, so bond may need to be issued," said Mr Rangsan.