Is this government overstepping its fiscal authority?

The Constitution Court's upcoming ruling on the legality of two financial decrees could determine the longevity of the Yingluck administration

The Constitution Court is expected to rule in the near future whether two financial decrees that the Yingluck Shinawatra government has put forward to Parliament are constitutional.

The most controversial issue has been the decree to transfer Bt1.14 trillion in debt incurred from the 1997 financial crisis to the Financial Institutions Development Fund (FIDF), an independent unit of the Bank of Thailand. The other decree is to enable the central bank to issue soft loans to finance flood-relief efforts.

The stability of the government could be shaken if the Constitution Court does not rule in its favour. If that turns out to be the case, the government will be forced to take full responsibility, should the decrees be annulled.

In addition, if the court rules that the decrees are unconstitutional, it will expose management flaws within the Yingluck government, whose motives for hastily enacting the decrees have been questioned.

Prime Minister Yingluck's government has been widely criticised for failing to come up with thorough plans to fix certain issues that threaten the stability of the economy. Among the cases in point are the government's decision to cut fuel subsidies and when or if the minimum wage will be increased nationwide, as promised during the last election campaign.

The latest controversy surrounding the decrees has raised the question of whether the government has no other option but to hastily enact these pieces of legislation to find additional sources of revenue. More money is desperately needed to finance plans to rehabilitate the Thai economy in the wake of massive losses after last year's flood disaster.

The government plans to issue four executive decrees to make it easier to mobilise funds for rehabilitation efforts and to prevent a recurrence of the devastating floods.

Of course, financial support is an essential element in the government's plan to lay down a framework to prevent future flooding and provide compensation and assistance to those affected by the deluge. But the announcement of these decrees before any concrete plan has been made public has raised the questions of whether taxpayers' money will be spent effectively.

Opposition MPs and senators filed a complaint with the Constitution Court seeking an interpretation on whether the government actually has the power to enact these decrees. The Opposition and senators believe that the situation is not urgent enough for the government to enact the four decrees. They argue that these decrees should be drafted as bills for Parliament to deliberate upon before they are enacted, because they are laws that can affect the country's economic stability.

However, the most forceful opposition voice has not come from the government's political opponents, but from an erstwhile insider - former finance minister Thirachai Phuvanatnaranubala.

Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong said the public debt-to-GDP ratio now stood at 12 per cent of the national budget, but Thirachai said the ratio was only 9.3 per cent. This has raised questions over the credibility of the information that the government has given to the public. It gave the opposition a field day in grilling the government. The opposition wants to know why the government did not allow parliamentarians to deliberate upon this critical issue, which can affect fiscal and monetary discipline.

The future of the two decrees and the Yingluck government itself will become clearer after the ruling by the Constitution Court, which is expected to take a couple of months.

If the court rules that it was constitutional for the government to enact these decrees, the issue will be over. The government will then only have to send the decrees to Parliament for endorsement.

But if the court rules otherwise, the future of the government will be unpredictable. Yingluck should keep her fingers crossed that the court will rule in her government's favour.