State enterprise status for KTB preserved

State enterprise status for KTB preserved

Proposal underway to clear up confusion

Finance Minister Arkhom Termpittayapaisith is preparing to forward a proposal to the cabinet to maintain Krungthai Bank's (KTB) status as a state-owned enterprise (SOE), with a duty to promote the government's economic activities.

KTB needs to remain a government tool to implement public policies, said Mr Arkhom.

These include the disbursement of state welfare and recent economic stimulus measures, such as the "We Travel Together" scheme and the co-payment scheme.

Although KTB is no longer classified as an SOE in accordance with the Budget Procedures Act of 2018, the bank is still classified as an SOE according to the Bank of Thailand's laws because KTB's major shareholder is the Financial Institutions Development Fund (FIDF), a government entity that holds a 55.07% stake, said Mr Arkhom.

The issue recently came to light because the Office of the Council of State interpreted the FIDF as not meeting the definition of an SOE. Therefore its majority stake in KTB means the bank should not be classified as an SOE.

On Nov 6, KTB notified the Stock Exchange of Thailand that it received a letter issued by the FIDF on Nov 3 about its opinion.

In the written opinion, it states KTB is neither a private nor public company classified as a "state-owned enterprise" under subsections (2) and (3) of Section 4 of the Budget Procedures Act of 2018.

The State Enterprise Policy Office, however, said although KTB may not be a SOE under certain definitions, it is still required to follow certain laws as a government agency.

In separate news, the Comptroller-General's Department has been instructed by Mr Arkhom to reduce the steps in the procurement process to speed up the disbursement of money to contractors. Foreign investors requested this issue be resolved to improve Thailand's ease of doing business score, he said.

The ministry aims to expedite fiscal budget disbursement.

Mr Arkhom plans to forward its proposal to set up a committee on accelerating fiscal budget disbursement, focused on large-scale infrastructure investment projects.

The government's fiscal budget disbursement ratio stood at 92% during the past 4-5 years, he said.

For fiscal 2021 that started in October, overall budget disbursement has been registered at 10.8% of the fiscal budget worth 3.29 trillion baht.

Disbursement of the regular budget is 13% of the total regular expenditure budget, worth 2.64 trillion baht.

Disbursement of the investment budget is 2.03% of the total investment budget, worth 648 billion baht.

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