Former Thai Finance Minister Thirachai Warns Against Off-Budget Loan

[webfact]

Thirachai warns against off-budget loan
The Nation


Thirachai

BANGKOK: -- Thirachai Phuvanatnaranubala, the first finance minister of the Yingluck Shinawatra administration, yesterday warned against the government's move to seek a Bt2-trillion "off-budget" loan for its mega-infrastructure plan.

"The investments are nothing of an emergency nature. There is no reason to bypass the normal budget process," Thirachai said via Facebook.

The main approval route as prescribed by the Constitution was good and subject to the oversight of both the National Economic and Social Development Board (NESDB) and the Budget Bureau, he said. When Yingluck became prime minister, Thirachai emerged as the first choice for the post of finance minister.

However, after serving for just about four months, he was removed in a Cabinet reshuffle reportedly for opposing the government's policy to make the central bank responsible for the country's Bt1.14-trillion debt incurred during the 1997 financial crisis.

On his Facebook page, Thirachai said the development plans should be included in annual budget, as off-budget financing means improper project reviews.

"When off-budget financing is sought, all governments, this one or those in the past, just set up a committee to screen investment proposals.

"Although the NESDB and Budget Bureau are represented on the committee, the projects cannot be thoroughly scrutinised," he said.

While off-budget financing is faster, it involves risks. Only a single committee is responsible for any mishaps, rather than the government agencies in charge.

"If (the borrowing bill) would finance an urgent project, it could be acceptable. But this is not an emergency. There is no justification to avoid routine budget vetting," he added.


-- The Nation 2013-03-11

[Robby nz]

This is one of her own telling her this.

Although in the past he has been dumped for not following the party line.

[dcutman]

While off-budget financing is faster, it involves risks. Only a single
committee is responsible for any mishaps, rather than the government
agencies in charge.

The only ones at risk, is the Taxpayer. Witch the real PM Thaksin Yingluck cares nothing about.

Just yet another example of Thailand's progress to democracy dictatorship.

[NeverSure]

C'mon. They aren't loans. They are "investments" for the suckers lenders.

That's what Yingluck Shinawatra told Belgium and Swiss leaders when begging for loans investments in this thread,

titled: "Yingluck Calls Thailand A Haven For Foreign Investment."

Pssst. Let's just keep these tttttrillions in loans off the books, eh cook?

[Locationthailand]

The fiscal irresponsibility of this Govt will leave the coffers empty and future generations in debt to the hilt. When even their own tell them it's a bad move, their arrogance by ignoring the advice continues to prove my point. But then Thaksin is hell-bent on payback for the seizure of his assets and will advise his poor sister to do his bidding with no thought to Thailand whatsoever. This is all about revenge. Throw PTP out whilst there is still a chance for Thailand.

[Buchholz]

"The investments are nothing of an emergency nature. There is no reason to bypass the normal budget process," Thirachai said via Facebook.

The main approval route as prescribed by the Constitution was good and subject to the oversight of both the National Economic and Social Development Board (NESDB) and the Budget Bureau, he said.

.

So similar to the 350 Billion "emergency" flood management budget that was ramrodded through without the normal checks and balances that turned out to be, a year later, not to be emergency.

.

Edited March 11, 2013 by Buchholz

[dcutman]

Hiding Public Debt

Hadi Salehi Esfahani

University of Illinois at Urbana-Champaign

Hoe-Jeong Kim
Ministry of Finance and Economy, Korea

April 2002

Abstract:

This paper examines the determinants of hidden public debt-that is,
government financial commitments and contingent liabilities that do not
receive official recognition and explicit budgetary allocations, but are
later on assumed by the government as additional debt outside the
normal budget. Hidden debts are large in many countries and can cause
major fiscal and macroeconomic instability. We show that the forces that
raise the demand for public expenditure, such as fractionalization and
division in the government, also motivate the politicians to resort to
disguised expenditure and debt as a means of alleviating constraints on
explicit borrowing. The tightness of such constraints also adds to the
incentive to hide debt, as do factors that reduce the costs of arranging
off-budget debts. We find that these costs decline with the extent of
government intervention in the economy, especially when the economy is
more developed and interventions allow the politicians to tap on larger
resources.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=306900

Edited March 11, 2013 by dcutman

[siampolee]

This current maladministration is outdoing the Baharn administration and their corruptness by billions, all the scams schemes are are all designed and designated as money making projects for Thaksin and his clan and their brown nosing acolytes.

Lets be totally honest, the greater majority of M.P.s are selected by their families or their business cronies to buy their way into parliament via vote buying or influencing the party list selectors.

Of course then if you have the money a ministry is yours for the asking.

Then the looting begins.

.

The whole ethos of being a member of parliament is about looking after your and your families and your cronies business interests and being able to siphon off as much money as possible in the shortest possible time for you and your family and of course your cronies benefits. while ignoring the long term consequences on the country and its people who will be picking up the debt burden in the long term.

The whole 2 trillion baht scam scheme is nothing more than a gigantic money trough for the selected few.

No budget on the books ?

With that sum of money floating around waiting to sink Thailand and its peoples into a quicksand of debt why is the budget off of the books ?

Because the Thaksin clan and their brown nosing acolytes do not want Mr and Mrs. Somchai, the average Thai man and woman on the street to actually see the numbers involved along with the corruption involved, then when this current maladministration is removed from office the subsequent administration will of course be seen as the bearer of bad news financially when the bailiffs come to call.

1997 and the subsequent financial medicine will indeed seem like a picnic when the account is rendered vis a vis this 2 trillion baht scam scheme so beloved bythe P.T.P. ( Parasites and Tick Party).

Thaksin and his cronies are indeed the financial blood sucking vampires and vultures of Thailand who will be feeding off of the corpse of the Thai nation and its peoples. Look carefully folks and you can see those vampires vultures circling even now as they plans are being laid for a gargantuan financial feast on a scale that has never been seen before in Thailand or even this world.

Should certainly be an interesting entry in ''The Guiness Book of Records for the biggest ever national debt.

Thailand will indeed become ''The Hub of Creditors and Bailiffs'' if this 2 trillion baht scam scheme is allowed to live.

Edited March 11, 2013 by siampolee

[AleG]

It's actually a 4 trillion Baht scheme...

[ramrod711]

"The investments are nothing of an emergency nature. There is no reason to bypass the normal budget process," Thirachai said via Facebook.

The main approval route as prescribed by the Constitution was good and subject to the oversight of both the National Economic and Social Development Board (NESDB) and the Budget Bureau, he said.

.

So similar to the 350 Billion "emergency" flood management budget that was ramrodded through without the normal checks and balances that turned out to be, a year later, not to be emergency.

.

just to be clear, i had nothing to do with it. ramrod711

[SOTIRIOS]

.......man.......this siphoning is out of control.......

....where is all the money going....

[Pimay1]

.......man.......this siphoning is out of control.......

....where is all the money going....

Where there is no accountability there is no transparency. When there is no transparency there are fraud or corruption.

[khunken]

I have a lot of respect for K. Thirachai. He didn't swallow his principles to follow the corrupt party line.

He was right about the FIDF B1.1Tn swept under the carpet to allow other borrowings & keep the 'official' level under 60%.

He is right again to point out that (1) this is not emergency funding that warrants a decree & (2) it should not be 'off budget', again to maintain that 60% level.

Off-budget sounds a bit like sub-prime & I suspect the lack of transparency involved is similar.

[waza]

Fair warning, massive loans without checks and balances is a very fast train to economic ruin.

[ratcatcher]

Not to take away from the seriousness of this thread, but I cannot help admire the Thai tie of Thirachai.

This is a man, among many others, not necessarily of PTP persuasion, who can clearly read the writing on the wall regarding this country's financial future including what must surely be opium induced pipe dreams regarding spending and major projects.

I also believe siampolee has invented a new acronym worthy of mention.

The BNA ie Brown Nosing Acolytes. Thaksin & his BNA.

[billoutt]

I'll bet he won't be fired this time.

Edited April 12, 2013 by metisdead
Font

[rubl]

BTW only three and a half more months to start allocating the THB 350 billion which we really needed so urgently that a special degree was issued to allow borrowing that amount. In December 2011 or January 2012, the issuing of the decree that is.

BTW this 350 billion decree was only one of two. The other one was of moving 1.14 trillion Baht under the BoT to reduce worries and possible headaches from just looking at it. Still some tell us, the economy is booming, Fitch happy. surely all Thai are also happy and rich and looking forward to Songkhran?

Edited March 11, 2013 by rubl