A 125-billion-baht debt owed by the Bangkok Mass Transit Authority (BMTA) will be transferred to the Ministry of Finance, only if the BMTA's rehabilitation plan proves effective, Finance Minister Arkhom Termpittayapaisith said on Tuesday.
On Monday, Mr Arkhom met Transport Minister Saksayam Chidchob to discuss the BMTA's rehabilitation plan. Mr Arkhom said he provided Mr Saksayam with details of the plan, which were recently changed. Mr Arkhom said the rehabilitation plan will be submitted to the cabinet for consideration.
The proposed transfer of the state enterprise's debts to the Ministry of Finance is intended to ease the BMTA's longstanding burden in repaying over 100 billion baht worth of debt, plus interest. The debt transfer is one of the options proposed for turning the BMTA around, he said.
More importantly, the ministry will have to study the details of the debt transfer proposal and the BMTA's rehabilitation plan, along with an analysis of the agency's financial situation.
The study will assess how fast the BMTA will be able to turn a profit, said Mr Arkhom.
Although the BMTA's debt is actually counted as part of the government's public debt, the finance minister explained that the transfer would free the state enterprise from its obligation to service the debt, blamed for holding back the agency for a long time.
Before the transfer is finalised, Mr Arkhom said the debt will have to be closely studied.
The process will determine which portion of the BMTA's debt has been accrued as a result of government policy, particularly the one offering free rides on public buses to offset the rise in living costs.
It is also important to pinpoint where the BMTA has run up debt through its own inefficiencies.
The BMTA will also have to demonstrate to the ministry how it plans to improve the quality of its services, such as by procuring new buses that are environmentally friendly before the debt transfer can go head, he said.