Executive-decree spending by August

Prime Minister Abhisit Vejjajiva yesterday said the Senate would convene next Monday to deliberate and vote on the measure, which would authorise the government to borrow funds on an emergency basis for spending on investment projects.

The Finance Ministry will issue an initial batch of bonds worth about Bt30 billion to borrow the Bt400 billion earmarked under the decree.

The ministry will employ a combination of bond issuance targeted at the general public and borrowing from domestic financial institutions, Abhisit said.

Meanwhile, Finance Minister Korn Chatikavanij and his aides were accused during yesterday's House debate on a second Bt400 billion of borrowing of using insider information in the trading of ACL Bank shares.

The House debate on a bill authorising the Finance Ministry to borrow the second amount heated up when Pheu Thai Party MP Worawat Uea-apinyakul focused his attack on Korn.

He charged the finance minister and his close aides in stock brokering with having taken advantage of knowledge that a foreign bank would buy a sizeable stake in ACL Bank, of which the Finance Ministry holds 30 per cent.

Worawat said ACL's share value rose 147 per cent since April to Bt5.40 on Monday. He claimed brokers close to Korn had bought the stock, as they had insider information.

He referred to a report by a daily newspaper that suggested the Finance Ministry had targeted selling shares of the bank at Bt8 apiece.

Korn responded angrily by saying Worawat was ill informed, as the newspaper had already apologised for the groundless report.

He said the Pheu Thai MP was trying to make the debate interesting after the opposition had failed to impress during Monday's debate on the executive decree.

Worawat also asked the coalition government to backtrack on the bill seeking authorisation for the borrowing of a further Bt400 billion. He said the government would have adequate funds for investment this year and next after the House approved the emergency financing on Monday night.

As the additional Bt400 billion would be used in 2011 and 2012, it was not necessary to borrow it now, he argued.

He suggested the government seek the public's opinion before additional borrowing beyond the first Bt400 billion.

Sunai Julapongsathorn, another Pheu Thai MP, expressed his suspicion of corruption in a number ministries regarding planned budgetary spending, particularly Education, Transport and Commerce. Charoen Chankomol, another opposition MP, said as the government would today introduce the Budget Bill seeking Bt1.7 trillion for fiscal 2010, it should not push the bill authorising a second Bt400 billion of borrowing.

Chalerm Yoobamrung, an outspoken MP from the opposition camp, made a short comment on the bill, which he said lacked transparency.

"Where will the money come from? What would the government do with this money? Where would the revenue come from to repay the debt?" he said. Chalerm promised his admirers he would have much more to say during today's debate on the Budget Bill, during which he is scheduled to speak from 4-6pm.

According to the government's Bt1.43-trillion investment plan for 2009-12, the additional borrowing of Bt800 billion as well as running a budget deficit each year would cause public debt jump to 61 per cent of gross domestic product in 2013 - from an estimated 40 per cent of GDP at the end of this year.

Public debt will start to decline in 2014, according to the Finance Ministry's projection.

Meanwhile, Pongpanu Svetarundra, director-general of the Public Debt Management Office, yesterday said the Finance Ministry would issue Bt30 billion worth of savings bonds in mid-July following the passage of the executive decree.