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The government plans to spend Bt97 billion to pledge for a total of 8 million tonnes of paddy, which will enter the market as a means to shore up the fluctuating rice price. The plan, however, does not guarantee that the benefits will go to farmers. In addition, the government is facing questions over where it will get the money to support the programme amidst budget constraints, thanks largely to the its mismanagement of the rice policy. Earlier, the government spent Bt120 billion to shore up the rice price through its rice pledging programme, in which the government accepted the second crop of rice at the unrealistically high price of Bt14,000 per tonne. This was a knee-jerk reaction to prevent farmers from staging a rally in Bangkok.

This time around, the government has lowered the pledging price. It has accepted the rice at Bt12,000 per tonne. But it remains to be seen if the programme will be effective in stabilising the rice price. Besides, the government is still looking for a source of money to finance the new rice-pledging scheme. The Rice Assistance Committee, chaired by Prime Minister Somchai Wongsawat, is already running at a deficit of Bt2 billion.

Instead of trying to find a long-term solution to help Thai farmers, the government has treated the rice policy as an immediate issue. It makes promises to farmers, hoping to score political points.

Although the government has decided to lower the pledging price, there remain questions over the source of money and whether the government will be able to recoup the outlay. The Commerce Ministry will meanwhile have to open the bidding to sell rice in its stocks totalling more than 3 million tonnes in order to collect some funds to contribute to the pledging scheme.

However, the Commerce Ministry is unlikely to make a profit from the bidding because a large supply of rice was bought into the government's stockpile when the rice price rose to a record level. The rice price recently declined sharply. The middlemen are likely to make a profit from this programme because they will be able to buy rice for export at a cheap price.

Thai taxpayers may not mind if they have to subsidise farmers, the backbone of the country. However, the biggest beneficiaries from this scheme are the middlemen.

Thai farmers meanwhile are suffering due to heavy rain, which has resulted in massive flooding of a large number of rice fields. At this time of year, Thai farmers expect to make money from harvesting the main rice crop, which is then supposed to enter the market. However, many farmers are unable to harvest due to the adverse weather conditions. There are growing calls for assistance to farmers.

In response, the government launched the rice-pledging programme, even though the programme has several flaws, and decided to open the bidding to sell rice to the government's stockpile. Small farms don't have many alternative products due to the recent flooding. The biggest beneficiaries are thus likely to be big farms or investors who have rice storage facilities.

There are also questions about whether the government will be able to ban blacklisted rice traders - who are barred from bidding because they defaulted on prior payments - from joining the bidding process this time.

These are the questions for which the government must find answers.

In the meantime, the government should look at long-term solutions to help Thai farmers increase their capacity and stand on their own, instead of re-launching rice pledging programmes that have proven to be a failure.

The government should place the rice issue on the national agenda and look seriously for ways to boost the competitiveness of Thai farmers in a sustainable manner.