NACC probe on PM a big setback to image of govt: Teerachai

Economy January 18, 2014 00:00

By Erich Parpart,
Petchanet Prat

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The anti-graft agency's decision to investigate caretaker Prime Minister Yingluck Shinawatra in connection with alleged irregularities in the rice-pledging scheme has tarnished the image of both her administration and the country, a former finance minist

Teerachai Phuwanartnaranubal said in an interview before entering a Bangkok business newspaper-sponsored seminar that the interim government and caretaker PM should reconsider the pledging scheme due to the financial losses incurred, the risk of corruption and overstocking.
“The charges against the caretaker prime minister have substantially destroyed her administration’s image because the National Anti-Corruption Commission [NACC] has seen fit [to investigate] and is confident there is enough evidence to hold her responsible for the alleged irregularities,” he said.
According to Teerachai, her government’s expectations have backfired because it miscalculated the global price of rice, which did not increase as they had hoped. This has resulted in the administration now suffering losses, because they are unable to sell the rice at the price that they want, because it is higher than the international market price. 
Other problems associated with the inability to sell rice under the pledging programme are those of corruption and overstocking, he added. 
The ex-minister explained said that the alleged irregularities in the programme were connected to the sale of rice via government-to-government (G2G) contracts. 
“The regulations concerning the selling of rice under a G2G deal and a domestic deal are different, which led to the forging of documents whereby rice contacts were made to look like they were a deal with a foreign government, but in reality the rice was being sold domestically,” he said.
He suggested there should be reform of the regulations concerning government involvement in the selling of agricultural products, because it was a risky and costly business and if the government truly wanted to help farmers, it should give the money to them directly. 
“The regulations concerning the selling of agricultural products need to be made stricter in order to deal with the issue of corruption,” said Teerachai, 
“In many countries, when they want to help their farmers, they give the money to them directly because the farmers can fully benefit from it that way. The shouldering of the price burden leads to the problem of overstocking, which is costly for the government,” he added.
He also suggested that the best way to provide direct financial help to farmers was through government-established Bank for Agriculture and Agricultural Cooperatives accounts, and proposed that the amount paid to each farmer could be determined by how much they could produce.
The best way to export agricultural products is via government-regulated agencies only, and the best way to get paid for exported products is through the letter-of-credit system, he said.
Meanwhile, Foreign Trade Department director-general Surasak Riangkrul said the department would be writing to the NACC, seeking the agency’s opinion on what it should now do in regard to rice-trading deals.
The department is also considering whether it needs to reshuffle some posts, as some of its high-level officials are allegedly involved in the “fake G2G deal” case. 
Every action taken by the department would be in accordance with the law, he insisted.
Tikhumporn Natvaratat, the Foreign Trade Department’s deputy director-general and one of the 15 officials allegedly involved in the fake G2G deal, said he needed time to clarify the NACC allegations and would discuss with the department’s legal team what he should do next. 
He has never had the chance to clarify the situation or explain himself with the NACC since it began looking into the case, he added.
Caretaker Commerce Minister Niwatthumrong Boonsongpaisan said that despite the NACC case, the government would proceed with the 2013/2014 rice-pledging scheme until the end of February, as scheduled. 
He argued that it was government policy to do so, and could not therefore be cancelled.
He urged the Election Commission to urgently approve a Bt130-billion loan, so that the caretaker government had enough money to pay rice farmers under the pledging programme.
He also said the 15 people against whom the NACC was pressing charges should defend themselves. 
Asked whether he knew about the questionable G2G rice deal, he said this was not the case as the matter had occurred before his arrival at the Commerce Ministry.
“The ministry will continue to release 200,000-300,000 tonnes of rice via general bidding soon, while it will sell 140,000 tonnes through the Agriculture Futures Exchange of Thailand on January 22,” he insisted.