The government denied Sunday that its <i>Thong Fah</i> (Blue Flag) store project, which sells low-price products to low-income earners, was launched in favour of agribusiness conglomerate the Charoen Pokphand Group (CP).
Government spokesman Sansern Kaewkamnerd said products in Thong Fah cut-price stores nationwide are drawn from several sources ranging from large manufacturing companies to local manufacturers and co-operatives in upcountry provinces.
"The Ministry of Commerce allows manufacturers at all levels including SMEs and co-operatives to take part in the Thong Fah project. There is no cronyism to benefit a large company [CP] because the policy aims to increase purchase options for low-income earners," he said.
Lt Gen Sansern said 24 manufacturers have taken part in the Thong Fah project and provided 40 categories of products for the stores. Of the categories, 31 comprise 160 consumer goods; eight are 72 education-related products; and one comprises 86 agricultural products.
All goods are 10-20% cheaper than those sold in competitors' stores. Under the scheme, holders of special cards are able to purchase goods at the lower price rate.
Most of the products are consumer goods such as rice, fish sauce, and non-prescription medicines, in addition to stationery and agricultural products including plant seeds and fertiliser.
Lt Gen Sansern made his comments after the scheme was criticised by firebrand and political activist Srisuwan Janya, who accused the government of launching the cut-price stores to favour CP.
In his role as secretary-general of the Association to Protect the Thai Constitution, Mr Srisuwan urged Prime Minister Prayut Chan-o-cha to review the scheme, as it could act as an impediment to local businesses who face competition with the discounts offered by the stores.
Mr Srisuwan said around 41.9 billion baht in state funds was dispensed to pay card-holders their 200-300-baht monthly allowance. They draw down from the balance on the cards when they shop at the stores. The scheme was no different from previous governments' populist policies, he said.
Implementation is another problem, he said. Only 5,061 out of 19,500 Thong Fah stores nationwide have been equipped with Electronic Data Capture (EDC) machines to read the welfare cards.
The Comptroller-General's Department said many Thong Fah shops confiscated the cards from customers in exchange for products costing 200 baht, claiming the shops had not been provided with EDC machines. Their idea was to retrieve 200 baht from the cards after the EDC devices were installed.
Lt Gen Sansern said Gen Prayut was aware of such problems with the system, and has ordered the Commerce and Finance ministries to expedite installing the EDC machines. Officials also were inspecting the stores to monitor irregularities and corruption related to the use of the welfare cards.