Democrats to take aim at rice-mortgage scheme: Korn

national July 31, 2012 00:00

By Somroutai Sapsomboon,

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The opposition plans to file a motion for censure debate in Parliament's next 120-day session starting tomorrow (Wednesday), with the government's rice-mortgage scheme likely to be one of the main issues, says Democrat Party deputy leader Korn Chatikava

“The censure debate will not only scrutinise corruption in the rice-mortgage programme but also government policies,” Korn said during the exclusive interview with The Nation.

“Most of the government’s policies have failed,” the opposition MP said. “They were just an offering to please the voters.”

Prime Minister Yingluck Shinawatra’s government began the rice-mortgage scheme after it came to power last year. Under the Democrat-led government of Abhisit Vejjajiva, the policy had been to guarantee rice prices.

The rice-mortgage scheme has come under heavy criticism due to the huge taxpayer-funded losses from buying rice at high prices and also because of corruption.

Korn, a former finance minister, questioned why the government insists on moving forward with the rice-mortgage scheme, which is of little benefit to rice farmers.

 “Every baht of the budget should benefit the farmers but it doesn’t,” Korn said. “I don’t know who the government is working for.”

Korn cited figures from a Thailand Development Research Institute study that found for every Bt100 of the government’s spending on the scheme, only Bt17 reaches the rice farmers.

“We’re talking about losses incurred by the state of about Bt90 billion for one year,” Korn said.

And those losses could be higher due such corrupt practices as smuggling in rice grown from outside the mortgage programme or replacing rice from this year’s crop with old rice.

“What I’m worried is that some people who are close to authorities are benefiting from this scheme and are addicted to the profit, so they will not allow it to be scrapped,” Korn said.
Commerce Minister Boonsong Teriyapirom said on Friday that the government might change details of the project by limiting the quantity of the rice for each farmer.
Korn said that one part of the rice-mortgage scheme that is especially rife with corruption is the construction of barns to store the rice.
“If you go to the lower North or northern Central regions, you will see construction of rice barns. It is estimated that from the rent – Bt2 per sack – that they store the rice for the government and hit a break-even point for the construction in 36 months. That means they get those barns for free.
“It’s the inventory that’s driving up the costs of this scheme,” he said. “But the barn owners will push for the government to continue it for 36 months. They won’t just retreat from the project.”
Meanwhile, rice exports have fallen during the first half of the year compared to a year ago, with Thailand losing out to India as the world’s top exporter. Analysts expect that Thailand will end the year in third place, with Vietnam moving up as the world’s No 2 rice exporter.
“It will be so difficult to take back our market and display space,” Korn said, noting that he visited shops in the UK and found only rice from Vietnam and India, not Thailand, on the shelves.

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