Graft fear for B1.97tn virus aid

Graft fear for B1.97tn virus aid

Watchdog warns cash could be 'siphoned'

Thailand's 1.97 trillion baht plan to mitigate against a further economic downturn caused by the coronavirus pandemic has raised concerns over the potential for embezzlement as large sums of money change hands between the government, businesses and local villages.

The Prayut Chan-o-cha administration's costly efforts to fight the outbreak on an economic front have prompted fears the country's culture of corruption could prevent those most in need from receiving assistance, the Anti-Corruption Organisation of Thailand (ACT) warned yesterday.

Without Thais helping to keep authorities in check, "another crisis will emerge underneath the [Covid-19] crisis", the watchdog said yesterday.

It demanded the government clearly tell the public not only how it will spend the money but also how it will ensure transparency and accountability.

"The government must take this seriously as a social contract," it said.

"Wrongdoers must receive severe punishments without exception."

However, government spokeswoman Narumon Pinyosinwat insisted the disbursement of relief money will be carefully overseen by the Finance Ministry.

Ms Narumon said she believed the ministry will ensure the money will be spent transparently in compliance with laws and regulations.

The Bangkok Post tried to contact the ministry directly yesterday, but spokesman Lavaron Sangsnit was unavailable for comment.

The government is required to seek approval from parliament, which is scheduled to convene on May 22, to enforce three executive decrees to greenlight the spending.

The first decree will enable it to borrow one trillion baht to relieve financial shortfalls among the citizenry and reinvigorate the economy.

The second will allow authorities to use 400 billion baht to stabilise the financial sector. The last decree will empower the Bank of Thailand to grant 500 billion baht in soft loans to businesses.

However, the Pheu Thai MP for Nan, Cholnan Srikaew, told the Bangkok Post that he remains uncertain whether the government will be "smart and transparent" enough to distribute money to the right people.

The trillion-baht segment is divided into two portions -- 600 billion baht in financial assistance for thousands of workers left unemployed by business shutdowns and 400 billion baht for what authorities call "grassroots economic restoration".

It is the latter that may be problematic in the view of Dr Cholnan.

According to the government, the money will be distributed to villagers and farmers through development projects proposed by state agencies.

"This method sounds familiar," Dr Cholnan warned.

"It sounds no different from budget allocation under Pracha Rath scheme."

The brainchild project of the Prayut government, the scheme, which literally means "people's state", is aimed at long-term sustainable development, with help primarily given to low-income earners.

"If the government opts to spend 400 billion baht this way, how it can say it is launching new measures to deal with a faltering economy?" Dr Cholnan said.

Previously, the Abhisit Vejjajiva government came under fire for tying up money in unclear development projects, such as its Thai Khem Khaeng (Thai Strength) scheme which was run under a decree to borrow around 400 billion baht during the subprime mortgage crisis.

Dr Cholnan asked why the Prayut government does not give money directly to needy villages and let them manage the budget themselves.

Some projects initiated by state officials tend to be carried out in an unusually expensive manner, Dr Cholnan said.

Construction of an artesian well, for example, may cost 100,000 baht, but if done by the government, the price can go up to 500,000 baht, he said.

"Where does the money go?" Dr Cholnan asked, echoing doubts raised by some experts that money may end up being siphoned away from the needy.

"If the Prayut administration is not smart, this trillion baht may only end up in the hands of big businesses," Dr Cholnan said, rather than those who need it most.

Nevertheless, the government faces a huge challenge if it wishes to keep the country's economic situation from worsening further.

"If actions are not quickly taken, the virus crisis will extend to the financial sector and end with severe social damage," Thammasat University's political economist Somjai Phagaphasvivat said.

To this end, the Secretariat of the Cabinet has reportedly asked state agencies to cut their 2020 budgets.

"The government wants the agencies to slash their budget by 10% for use in Covid-19 solutions," the secretariat said in confidential letters sent to the agencies.

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