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Published on February 13, 2008

However, the new fiscal laws have not yet been implemented, as the laws are currently under consideration by the Finance Ministry. The laws need the endorsement of Parliament before enforcement and might be revised later.

The Thailand Research Fund (TRF) and the Thailand Development Research Institute (TDRI) yesterday unveiled a draft of new fiscal laws as organic laws of the new Constitution.

In response to poor management of public finance by politicians in the past, the Constitution required that two laws - evaluation and disclosure of fiscal position and amendment of the Budgeting Act 2502 - must be completed in two years.

TRDI research director Somchai Jitsuchon said the new laws would limit the power of the prime minister in using the central fund of the annual government budget.

The government cannot just set up a large central fund under direct supervision by the prime minister, according to the new laws. The central fund must be largely earmarked for emergency spending only, Somchai said. Non-emergency spending must not exceed 5 per cent of the total budget.

Meanwhile, the prime minister cannot spend more than Bt100 million. If he wants to spend more, he must ask approval from the Cabinet. The central fund is part of the annual government budget.

Critics previously charged ousted prime minister Thaksin Shinawatra for wasting taxpayers' money and creating high contingent liability for the future under his populist policies.

Somchai said the laws should plug all loopholes in the existing budgeting act. Spending by all state agencies must be closely monitored, he said. Therefore, state agencies will include public organisations, independent organisations created under the Constitution, state-owned enterprises and other organisations in which the government holds not less than a 50-per-cent stake.

The new laws will also require these state agencies to disclose their financial statements to the public.

Wichit Chaitrong

The Nation