Special Report: Govt to provide free milk to all primary students

In a bid to solve the problem of oversupply of milk in the market, Prime Minister Abhisit Vejjajiva yesterday announced a plan to provide free milk to all primary students 260 days a year.

Currently, only students from Grade 1 to Grade 4 are in the government's school-milk project and they are entitled to free milk only 230 days each year.

In his "Confidence in Thailand with Prime Minister Abhisit" talk show yesterday morning, the PM said his government planned to supply free milk to all primary students 260 days a year based on a discussion between concerned ministers and dairy farmers on how to tackle the oversupply of milk.

Abhisit also talked about solving irregularities in the school-milk project's bidding process and the issue of spoiled milk.

The premier said the Cabinet will today make two key decisions concerning the school-milk project - changing the ratio of UHT to pasteurised, and the zoning system.

The decisions are intended to put an end to spoiled milk being sent to schools, and root out corruption in the supply system. About 40 schools nationwide have reported receiving spoiled milk.

The six ministries involved, directed by Deputy Prime Minister Korbsak Sabhavasu, want to switch the ratio of UHT to pasteurised from 30:70 to 70:30 with immediate effect. UHT, being subjected to a higher temperature, keeps better than pasteurised.

Over 50 suppliers of the total of 71 will be affected as they carry only pasteurised.

As loud as complaints over spoiled milk is criticism of the zoning system, whereby a province is given a list of suppliers allowed to bid.

Schools are allowed to use only suppliers whose plants are within a 100-kilometre radius, who must enter a bidding process. This aggravates price collusion in provinces where the number of suppliers exceeds that of contracts. As some suppliers resell the contracts at a premium, the sub-contractors squeeze their costs by mixing low-quality ingredients into the milk, leading to poor-quality milk for five million students.

The school-milk project, initiated in 1992, was deemed beneficial when milk was a luxury for students in many schools. However, like many projects, it was poorly implemented.

The government has tackled problems as they have cropped up. For example, the zoning system was implemented to keep milk from spoiling during transportation, as it could when any firm could supply any school at any distance. Now it may be abolished. When faced with oversupply, politicians expand the number of students eligible to benefit from the scheme, though this entails higher budgets.

To take a particular case, if the government's approval of extending the supply to cover Prathom 5 and Prathom 6 students takes effect next year, Thailand would shoulder an additional Bt3 billion cost on top of the current Bt8 billion.

Throughout its 17 years, no single agency has been able to provide an overall picture of the scheme, as it involves a number of organisations under six ministries. Maybe the Abhisit government should consider this and limit politicians' intervention in future.

Farming Promotion Organisation of Thailand board of committees chairman Amnat Teerawanit said the government had better tackle problems in the school-milk project one by one.

"For example, if the government is concerned about the milk quality, it should prescribe standards," he said. "If it's the corruption that the government wants to eradicate, then the government will need another set of measures".

Amnat expressed concern that the abrupt decision to increase the ratio of UHT milk in the school-milk project could hurt small-scale dairy farmers as well as pasteurised-milk factories.

The manufacturing of UHT milk may use imported milk powder, while the manufacturing of pasteurised milk needs pure cow milk.

"If small pasteurised milk-makers want a system that can manufacture UHT products too, they will need to spend between Bt30 million and Bt40 million," Amnat said.

Asked about the proposed change in zoning system, Amnat believed corruption in other forms could take place.

"When the school-milk project did not have the zoning conditions, there were complaints about monopoly," he said.

He believed from now on, the government should carefully think about how to solve each problem and prepare a full set of measures to implement the solutions.

"If the government fails to do so, the public will suffer," Amnat said.