Stimulus package may be speedy, but is it efficient?

However, most of the components of the package, with the exception of the Bt15 billion marked for education and related subsidies, will fail in terms of efficiency and structural improvements.

First, there's the Bt19 billion earmarked to cover the treasury accounts' shortfall - good for a government that has gone broke, but offering no lasting economic benefits.

Second, the one-time Bt2,000 each for about nine million civil servants and low-income workers who make Bt15,000 or less per month. This so-called "helicopter money" to spur economic activity would cost the government Bt18.9 billion.

Critics say it's unimaginative and the multiplier effects will be limited. However, this measure should be effective as far as a speedy injection of funds into the economy is concerned.

At this juncture, the economy needs a quick infusion of funds so a large number of consumers have the cash to purchase goods and services to help businesses and industries survive.

The measure would generate more multiplier effects if businesses and industries were invited to join the government's campaign to promote consumption.

Then cash handouts could be converted into coupons, with private enterprises offering discounts to boost their sales. By handing out coupons with a specific validity, recipients would be forced to spend while businesses and industries would benefit from higher sales.

Third, free education for 15 years and further subsidies on tuition fees, uniforms and textbooks.

This measure, which will cost Bt19 billion, is the one that will have long-term benefits in terms of education and help the economy in the short run as producers of uniforms and textbooks have stronger sales.

Fourth, the sufficiency-economy village fund totalling Bt15.2 billion will have similar effects as the ones introduced during Thaksin Shinawatra's era, when 70,000 villages nationwide were given Bt1 million each as a revolving nest egg for loans. It will take some time for the gains to trickle down to the economy.

Fifth, the government will spend Bt11.1 billion to subsidise bus and railway services for the poor over the next six months. This subsidy should leave a bit more money in consumers' pockets so they may be expected to spend a little more to keep the economy from contracting in the first and second quarters.

Sixth, senior citizens will be given Bt500 per month. This measure, which will cost the government Bt9 billion, is another simple cash handout similar to the one planned for civil servants and low-income earners. It's good in terms of speed, but again it's not going to be very efficient in terms of stimulating economic growth in the long run.

Seventh, the Bt6.9 billion meant to train the unemployed. This measure will not give a quick return, but should benefit the economy in terms of preparing people for changes in the labour market. In fact, there should be more comprehensive retraining programmes for the workforce in coming months.

Eighth, the Bt3-billion budget for rural health volunteers is more like a welfare measure since these workers are not paid properly in the first place. There should be few positive effects on the rural economy.

The rest of the projects - namely the Bt2-billion irrigation scheme, Bt1.8 billion for police housing, Bt1 billion for cheap goods, Bt1 billion for tourism promotion, Bt500 million for the food industry and SMEs and Bt325 million for national image improvement - are far too small to have significant benefits.