The Supreme Administrative Court ruling ordering former prime minister Yingluck Shinawatra to compensate the state for damages caused by her government's rice-pledging scheme between 2011 and 2014 -- amounting to tens of billions of baht -- has reawakened painful memories for me as I worked as a commissioner at the National Anti-Corruption Commission (NACC) more than a decade ago.
The pain stems from my having to investigate Yingluck's case. We had become acquainted as classmates in a training programme at the Capital Market Academy. When the NACC ruled that there was sufficient evidence to indict her, I had already retired from the NACC. Somehow, I couldn't help feeling distressed knowing that Yingluck would inevitably face severe consequences, which she subsequently did.
When I began working at the NACC in late 2006, I observed that many government rice subsidy efforts were plagued by corruption related to rice quality inspections, storage, and distribution, among others. Similar issues existed with other crop subsidy policies with cassava, rubber and maize. As an economist, I launched research funded by the NACC, hiring academics from universities nationwide to study price subsidies for various crops, including rice.
The conclusion was crystal clear: the most effective agricultural subsidy policy required the setting of a fair median price for farmers as a benchmark for the government to provide compensation when farmers had to sell rice when market prices fell below the predetermined threshold. This approach was resonant with economic principles -- avoiding market distortions, minimising costs, and reducing opportunities for corruption. The NACC proposed this policy to Samak Sundaravej's government, but received the cold shoulder in return. However, the policy recommendation was well received by the Abhisit government. This government gave this policy a name, the "price guarantee scheme", implemented without many operational adjustments.
By the time of the 2011 elections, the Pheu Thai Party, led by Yingluck Shinawatra, made rice-pledging an electoral policy flagship. The scheme promised farmers that if elected, the government would make rice prices 50% above market prices. Many at the NACC were alarmed. Based on experience, we were certain such a policy would lead to massive corruption and economic disaster. Indeed, the NACC voiced its concerns immediately and after Yingluck became prime minister. I even sent her a personal email on Election Day, on July 3 the same year, urging her to abandon the policy. Needless to say, my warning was ignored.
It must be said that the day before the launch of the rice-pledging scheme on Oct 7, 2011, the entire NACC board sent a formal letter to prime minister Yingluck, warning of the corruption risks and waste of resources, and urged her to cancel or revise the policy. Again, there was no response.
By the first harvest season of 2012, signs of corruption and inefficiency were palpable and reported. Yet the government did nothing. The NACC sent another formal letter urging a policy review.
This time around, there was some reaction: Yingluck's government requested input from various economic agencies -- the Ministry of Finance, the Budget Bureau, the National Economic and Social Development Board, the Commerce Ministry, the Office of the Auditor General, and others.
Nearly all at these agencies opposed the rice-pledging scheme in its current form -- except the Commerce Ministry.
This may explain why only Commerce Ministry officials and minister, Boonsong Teriyapirom, ended up jailed for irregularities in the rice sales.
Despite clear evidence of malfeasance in the process such as fraudulent claims, cross-border rice smuggling, rice-quality issues, storage costs and final sales, Yingluck persisted with the scheme for three to four more seasons. By the time the complaints reached the NACC, the damage and irregularities were too evident to question the government's real intention. The NACC could immediately proceed with an investigation.
Some legal and political scholars argue that in a democracy, an elected government should have a free hand to implement policies approved by parliament. However, government actions and parliamentary approved policy promises do not override existing laws. If certain government actions and campaign promises do not align with the law, these policy promises are not exempt from legal consequences.
Many claim Yingluck was innocent in the rice purchases but guilty only in the sales. This is incorrect. The NACC found that even the purchasing violated Section 84(1) of the 2007 constitution, as it turned the government into a monopolistic entity, destroying Thailand's normal rice market system.
The irregularities in rice sales alone provided ample grounds to hold Yingluck's government accountable -- as confirmed by the Supreme Court's Criminal Division for Holders of Political Positions. Thus, Yingluck has been found guilty both criminally and civilly.
I sincerely believe Yingluck was more a victim than the perpetrator of this policy. It is regrettable that she chose to trust the creator of such a reckless scheme instead of listening to well-meaning advisers, including her own chief economic adviser.
If I were a billionaire, I would not hesitate to pay the compensation money Yingluck has to pay myself, allowing her to return under a fair and lawful arrangement. The compensation money would not vanish -- it would go towards national development, finally closing this painful chapter of history.
Medhi Krongkaew, PhD, taught economics at Thammasat University, NIDA, the Australian National University, and the University of California, San Diego. He also served as a National Anti-Corruption Commissioner.