Abhisit Takes On Govt Over Rice Losses

[Lite Beer]

Abhisit takes on govt over rice losses
The Nation on Sunday

BANGKOK: -- Democrat chief says figures prove losses amount to Bt260 billion

Opposition leader Abhisit Vejjajiva yesterday said that figures released by concerned state agencies show that the government's rice-pledging scheme had suffered a loss of Bt260 billion.

The Democrat Party chief said that only Bt80 billion of the state subsidies had reached the farmers. A massive amount of money is wasted through corruption, he said.

Abhisit called a press conference yesterday, and dismissed statements by Commerce Minister Boonsong Teriyapirom and his deputy, Natthawut Saikua and Deputy Finance Minister Thanusak Lek-uthai, who denied on Friday that the rice-pledging scheme has suffered a Bt260-billion loss as revealed by a Finance Ministry committee.

Abhisit said Thanusak had earlier admitted at press conferences that the scheme had suffered a Bt220-billion loss for both in- and off-season crops in 2011-12. He rejected the arguments of the government that until it had sold the rice stocks in its warehouses across the country, it would never know whether the scheme was profitable or loss-making.

Abhisit said the Finance Ministry's accounting methodology involved calculating how much money the government had received from selling rice and how much it had spent for the pledging and the market value of the unsold grains.

"It is like buying an item at Bt100 and you keep this item in your stock while the market price is Bt80. So it means you lost Bt20 even though you have not sold it. In fact, in the case of rice the losses maybe even more because rice keeps degrading, unless there is a market fluctuation that causes prices to skyrocket, but that is an unlikely scenario for rice," he said.

Abhisit rejected the government's claim that the losses also included those from all agricultural produce subsidised by the previous government. He said the Yingluck government's first round of rice-pledging had suffered a loss of Bt42 billion. The loss was lower than the rice-pledging rounds that followed because the scheme could not fully operate due to the massive flooding in 2011. But following the second and third crops, the scheme suffered a total loss of Bt178 billion, excluding Bt40 billion operation cost. Thus, the total loss is definitely more than Bt200 billion, he said.

The Finance Ministry committee showed that as of May 31, 2012, the 17 subsidy schemes for agricultural produce suffered a loss of Bt206 billion but the January 3, 2013 figure rose to Bt393, which means the losses rose by Bt187 billion, excluding operating costs. "These figures all confirm that the rice-pledging scheme definitely has suffered losses which could amount to Bt260 billion," Abhisit said.

The government has so far spent Bt661 billion for the rice-pledging scheme. The government said it had paid back the Bank for Agriculture and Agricultural Cooperatives Bt120 billion borrowed for the scheme while the rice stored in warehouses was worth Bt226 billion. "That means Bt315 billion is still missing from the total Bt661 billion spent. The government cannot deny that the rice-pledging scheme has suffered a loss of Bt260 billion," he said.

The Bank for Agriculture and Agricultural Cooperatives, Abhisit said, had revealed that benefit to farmers from the scheme amounted to only Bt86 billion. "That means farmers enjoy less than half of the money lost. The government should have just given the money to farmers [without pledging it] and the country's rice markets would not have been destroyed and the country would not have lost its status as the world's No 1 rice exporter," he said.

The opposition leader also dismissed the government claim that the scheme had increased farmers' income. Citing statistics released by the Bank of Thailand, he said they showed that agricultural income in the third quarter of last year plunged 4.1 per cent and the last quarter last year was minus .7 per cent, the first quarter of this year was minus 2.2 per cent and at the end of April, the figure was minus 7.7.

Pheu Thai's Nakhon Phanom MP Paijit Srivarakan said he believed Boonsong had failed to clarify about the losses under the rice-pledging scheme. He said the minister should not make the public feel as if the project is under a cloud.

"Although farmers are happy with the project, the management of the scheme must be more transparent. If the minister fails to give a clear explanation, the opposition will move politically to attack us and there are other groups waiting in the wings to topple the government. Therefore, the government must fully understand the scheme and give a better explanation," he said.

Pheu Thai's Ubon Ratchathani MP Somkid Chuakong said he was irritated with Boonsong's clarification on the rice-pledging scheme, saying it was difficult for the public to understand even though he was able to give easy-to-understand messages.

"I believe Boonsong does not have the figures on rice stocks in the warehouses and how much rice has been sold last year and this year. The concerned agencies have yet to provide him with the figures. This makes the public sceptical about his clarification. He is a quiet man but next time he must be better prepared with information so that the government does not fall a victim to attacks by critics," he said.

-- The Nation 2013-06-09

[ChrisY1]

"I believe Boonsong does not have the figures on rice stocks in the warehouses and how much rice has been sold last year and this year."

I don't think anyone has the figures on rice stocks, both in store or sold!

This whole affair is getting the PTP in deeper and deeper each day.......ratings agencies may be starting to smile a little at the fiasco unfolding here with the Government...and this is only one of the many scams being mismanaged by the Govt.

[apetley]

Politics aside can anyone find fault with much of what Abhisit is saying because I can't.

Especially sensible seems to be the Dems policy of paying direct to the farmer.

Sent from my GT-I9003 using Thaivisa Connect Thailand mobile app

[473geo]

Politics aside can anyone find fault with much of what Abhisit is saying because I can't.

Especially sensible seems to be the Dems policy of paying direct to the farmer.

Sent from my GT-I9003 using Thaivisa Connect Thailand mobile app

Perhaps the Dems should have taken their own advice, previously they subsidised a price increase of fertiliser,(corruption free?) rather than give direct to the farmer. Good for the fertiliser manufacturers, usage wouldn't fall away profits rise, but the farmer who used little or no fertiliser saw no increase in revenue as the rice price remained poor. I guess the subsidy was good for the larger farmers as it would maintain their profit levels too. Supporting the end product price is the way to go (in my opinion) if it can be maintained at reasonable cost, and the pricing levels are constant through the system with benefit filtering down to the lowest levels i.e the small producer. I am also interested to know where the corruption is supposed to be for example in the BAAC purchases. Don't see any proof.

Edited June 9, 2013 by 473geo

[LuckyLew]

Common Moody's lower the rating already

Why so slow to act on what is obviously a pitiful effort by the PTP to explain themselves?

[Bellweather]

Abhisit's main problem is the confusion over the figures as we have government ministries disagreeing publicly, the PM admitting she hasn't been given a final figure and another comment that nothing will be known until the scheme ends in September but everybody is wrong about the losses anyway.

It really doesn't matter what Abhisit produces as the government will hide behind the wait to September excuse and all he can do is expose how inefficient the government and scheme is since no one has a clue what's going on.

I would suspect that when the final figures are produced, if ever, they will be suitably doctored to minimise losses and Abhisit's argument.

[OzMick]

Politics aside can anyone find fault with much of what Abhisit is saying because I can't.

Especially sensible seems to be the Dems policy of paying direct to the farmer.

Sent from my GT-I9003 using Thaivisa Connect Thailand mobile app

Perhaps the Dems should have taken their own advice, previously they subsidised a price increase of fertiliser,(corruption free?) rather than give direct to the farmer. Good for the fertiliser manufacturers, usage wouldn't fall away profits rise, but the farmer who used little or no fertiliser saw no increase in revenue as the rice price remained poor. I guess the subsidy was good for the larger farmers as it would maintain their profit levels too. Supporting the end product price is the way to go (in my opinion) if it can be maintained at reasonable cost, and the pricing levels are constant through the system with benefit filtering down to the lowest levels i.e the small producer. I am also interested to know where the corruption is supposed to be for example in the BAAC purchases. Don't see any proof.

There is none so blind as those that will not see. Everything is fine, I'm all right Jack (in your opinion).

Can you explain how supporting the end product price,well above market rates, and with no differential for quality "is the way to go"? You could try a compare and contrast on what we are seeing in the real world.

Edited June 9, 2013 by OzMick

[bigbamboo]

Abhisit's main problem is the confusion over the figures as we have government ministries disagreeing publicly, the PM admitting she hasn't been given a final figure and another comment that nothing will be known until the scheme ends in September but everybody is wrong about the losses anyway.

It really doesn't matter what Abhisit produces as the government will hide behind the wait to September excuse and all he can do is expose how inefficient the government and scheme is since no one has a clue what's going on.

I would suspect that when the final figures are produced, if ever, they will be suitably doctored to minimise losses and Abhisit's argument.

I wouldn't say this a problem for KA at all.

He can enjoy watching KY and the rest stew in their own cock up whilst the financial world watches on for a while longer yet!

[Thai at Heart]

Funny how the government can mandate sale prices for eggs and sugar but not fertiliser.

[Payboy]

Or, try to sell eggs by the kilo.

http://www.nationmultimedia.com/2011/01/27/opinion/Abhisit-could-end-up-with-egg-on-his-face-30147247.html

[Thai at Heart]

Why is it apparently only abhisit on this one.

Shouldn't the whole democrat party be on this one. Scream it loud. The rice scheme is bust.

Unless, the rest of them are busy getting their cars out of the country? Lol

[OzMick]

Remember the hissy fit that Thaksin threw when the AEC seized THB46 billion of his hard "earned" money? Compare that to the glib statements "We've only lost B70/86/100 billion" (depending on the version).

Taxpayer's money somehow seems to have lower worth than personal funds.

[chainarong]

The fallout of this vote buying scheme , is not only have they the PTP lost a considerable amount of money in the process ,they have lost their world markets , that in itself is a disaster, there is no proof that regular buyers will return in the short term , after Thailand tried to inflate the price to cover all their costs, import / exporters have long memories , so one must mention in closing , well done PTP for ruining the rice export industry of Thailand.

[iancnx]

Good move Abhisit..... Let us hope this is the beginning of a wider strategy to move towards a vote of no confidence in YS and her government. Need to move fast in order to rescind current intention to extend the rice scam for another damaging year.

In my view the best outcome would be to

1. sell off all the current stock piles NOW at whatever best value, even if it has to be dog food. Clean the silo's.

2. Prepare the world market for ALL of Thailand's next season rice to be exported (less domestic consumption).

3. Consider subsidies for the poorest farmers (5 Rai or less?) in the event market price is low.

4. Sort out the strength of the Baht so that exporters in all sectors can be more competitive, and attract more tourists who currently see the LoS as the an expensive option in SE Asia.

5. Stop playing at being in ASEAN and formulate a policy which addresses the woefully poor education system. Understand a degree in Thailand is little more than a couple of A levels in UK. Understand education in many of the ASEAN countries is of a much higher standard. Understand just how crucial this is for the future of the next generation!

The above is not Thai bashing, far from it....it is merely the reality of where we are in the pecking order internationally and deiberately mentions nothing about alleged corruption etc etc.

[Neilly]

Abhisit takes on govt over rice losses

If he can get this Genie out of the bottle then the rest should be easy

[smutcakes]

The fallout of this vote buying scheme , is not only have they the PTP lost a considerable amount of money in the process ,they have lost their world markets , that in itself is a disaster, there is no proof that regular buyers will return in the short term , after Thailand tried to inflate the price to cover all their costs, import / exporters have long memories , so one must mention in closing , well done PTP for ruining the rice export industry of Thailand.

Importers/exporters will buy the best value for money rice- whether that be from Thailand or anywhere else, they could not give a monkeys chaf about rice pledging/ internal politics etc etc etc 'well done PTP for ruining the rice export industry of Thailand.' hyperbole much!

The pledging scheme is a mess, which needs to be resolved one way or another, but dont start implying its ruined the Thai rice export industry long term!

[bentleyboy]

"I believe Boonsong does not have the figures on rice stocks in the warehouses and how much rice has been sold last year and this year."

I don't think anyone has the figures on rice stocks, both in store or sold!

This whole affair is getting the PTP in deeper and deeper each day.......ratings agencies may be starting to smile a little at the fiasco unfolding here with the Government...and this is only one of the many scams being mismanaged by the Govt.

I don't think the rating agencies will be smiling, I think they will be reaching for the alarm bell.

[gabruce]

Abhisit's main problem is the confusion over the figures as we have government ministries disagreeing publicly, the PM admitting she hasn't been given a final figure and another comment that nothing will be known until the scheme ends in September but everybody is wrong about the losses anyway.

It really doesn't matter what Abhisit produces as the government will hide behind the wait to September excuse and all he can do is expose how inefficient the government and scheme is since no one has a clue what's going on.

I would suspect that when the final figures are produced, if ever, they will be suitably doctored to minimise losses and Abhisit's argument.

Actually, Boonsong was saying that it would take 3 years AFTER the program finishes this September before they would know profit or loss. I think that might be because after rice has been in inadequate storage for 3 years it's no longer saleable and they can declare a 100% loss?

That would also be a good way to hide having sold all of the rice privately for a tidy profit. Good idea!

[ratcatcher]

Good move Abhisit..... Let us hope this is the beginning of a wider strategy to move towards a vote of no confidence in YS and her government. Need to move fast in order to rescind current intention to extend the rice scam for another damaging year.

In my view the best outcome would be to

1. sell off all the current stock piles NOW at whatever best value, even if it has to be dog food. Clean the silo's.

2. Prepare the world market for ALL of Thailand's next season rice to be exported (less domestic consumption).

3. Consider subsidies for the poorest farmers (5 Rai or less?) in the event market price is low.

4. Sort out the strength of the Baht so that exporters in all sectors can be more competitive, and attract more tourists who currently see the LoS as the an expensive option in SE Asia.

5. Stop playing at being in ASEAN and formulate a policy which addresses the woefully poor education system. Understand a degree in Thailand is little more than a couple of A levels in UK. Understand education in many of the ASEAN countries is of a much higher standard. Understand just how crucial this is for the future of the next generation!

The above is not Thai bashing, far from it....it is merely the reality of where we are in the pecking order internationally and deiberately mentions nothing about alleged corruption etc etc.

Excellent ideas. But the fact is you expect too much from these people.

[BlackJack]

everone has to do the books every 3 months to see whats going on

why isnt this happening here with the rice scheme

its business 101

blind freddie the accountant can see whats going on but is powerless to say anything

YL is setting up 2 more investigation groups - all looks buy the book

but as every business knows theres always 2 sets of books

[drdoom6996]

"Although farmers are happy with the project, the management of the scheme must be more transparent. If the minister fails to give a clear explanation, the opposition will move politically to attack us and there are other groups waiting in the wings to topple the government. Therefore, the government must fully understand the scheme and give a better explanation," he said.

A better explanation from people who don't understand themselves what to do and when to do it. It puts money in PTP members pockets. What else is it that PTP needs to explain? The people don't need to understand when PTP does anything. PTP and their God in Dubai has everything under control. DON'T WORRY!

[MEL1]

The simple matter is that 220Billion is missing, and everybody knows where it has gone.

The difficult matter is that that is a lot of money, making the powerful so much more powerful and being able to 'buy' anybody of previous credence out of the equation, when it comes to questioning.

The PTP are creaming every cravace, every mass of movement of any business, any possible threat to their own minions even - that could break the chain.

Tough times ahead of them, as one deep exposure will topple the dominoe castle they have built. I'm waiting for somebody to really expose from bottom up, but the potential for that is negligible, as that person would take the money and run.

-mel.

[Thai at Heart]

Abhisit's main problem is the confusion over the figures as we have government ministries disagreeing publicly, the PM admitting she hasn't been given a final figure and another comment that nothing will be known until the scheme ends in September but everybody is wrong about the losses anyway.

It really doesn't matter what Abhisit produces as the government will hide behind the wait to September excuse and all he can do is expose how inefficient the government and scheme is since no one has a clue what's going on.

I would suspect that when the final figures are produced, if ever, they will be suitably doctored to minimise losses and Abhisit's argument.

Actually, Boonsong was saying that it would take 3 years AFTER the program finishes this September before they would know profit or loss. I think that might be because after rice has been in inadequate storage for 3 years it's no longer saleable and they can declare a 100% loss?

That would also be a good way to hide having sold all of the rice privately for a tidy profit. Good idea!

So when the system ends in September, the warehouses will presumably still be full, and what happens then?

They break down the millions of sacks of rice and then estimate the value, damage and loss? Why wait till September?

[SICHONSTEVE]

Politics aside can anyone find fault with much of what Abhisit is saying because I can't.

Especially sensible seems to be the Dems policy of paying direct to the farmer.

Sent from my GT-I9003 using Thaivisa Connect Thailand mobile app

This is exactly what I would have implemented!! It is not rocket science, but takes away a lot of beaurocracy, gets money directly to the farmers and cuts out corruption..........oh I see now.

[billd766]

The fallout of this vote buying scheme , is not only have they the PTP lost a considerable amount of money in the process ,they have lost their world markets , that in itself is a disaster, there is no proof that regular buyers will return in the short term , after Thailand tried to inflate the price to cover all their costs, import / exporters have long memories , so one must mention in closing , well done PTP for ruining the rice export industry of Thailand.

Importers/exporters will buy the best value for money rice- whether that be from Thailand or anywhere else, they could not give a monkeys chaf about rice pledging/ internal politics etc etc etc 'well done PTP for ruining the rice export industry of Thailand.' hyperbole much!

The pledging scheme is a mess, which needs to be resolved one way or another, but dont start implying its ruined the Thai rice export industry long term!

So the Thai rice industry slipping from first to third place in a year is not a problem for you or the country?

Sitting on a huge stockpile of unsold rice in storage that is degrading in quality and cannot be sold at the market price thus meaning a HUGE loss is not a problem for you or Thailand?

Trying to sell rice of a much lower quality at the same price that you did two years ago at market prices then is not a problem to you and to Thailand?

Lower quality means lower prices so buyers who want high quality rice at market prices won't touch the rubbish that Thailand is trying to sell now and that is not a problem to you and Thailand?

The rice pledging scheme has all but ruined the Thai export market as nobody will trust the quality or quantity any more and that is not a problem to you and Thailand?

If Thailand dumps the rice on the market at market or lower than market prices they will be in deep trougle with the WTO as well as incurring MASSIVE losses to Thailand and that is not a problem to you and Thailand?

If they aren't problems then what do YOU call a big problem?

[bunuel]

By the way, if you browse Cambodian rice sales for last year, you will see that Thailand was their #4 buyer!

Can anyone explain why Thailand should be buying rice from Cambodia when it has such a surplus??

"I believe Boonsong does not have the figures on rice stocks in the warehouses and how much rice has been sold last year and this year."

I don't think anyone has the figures on rice stocks, both in store or sold!

This whole affair is getting the PTP in deeper and deeper each day.......ratings agencies may be starting to smile a little at the fiasco unfolding here with the Government...and this is only one of the many scams being mismanaged by the Govt.

[SICHONSTEVE]

By the way, if you browse Cambodian rice sales for last year, you will see that Thailand was their #4 buyer!

Can anyone explain why Thailand should be buying rice from Cambodia when it has such a surplus??

"I believe Boonsong does not have the figures on rice stocks in the warehouses and how much rice has been sold last year and this year."

I don't think anyone has the figures on rice stocks, both in store or sold!

This whole affair is getting the PTP in deeper and deeper each day.......ratings agencies may be starting to smile a little at the fiasco unfolding here with the Government...and this is only one of the many scams being mismanaged by the Govt.

Simple, because you can eat it!!

[Valentine]

I don't see the price of rice dropping in the supermarkets. It seems they would rather let all this good rice rot away than sell it at a good discount for the general population. Selling it locally might not make a big dent in the stockpile but it would certainly make a lot of people happy & ease the cost of living.

[jbrain]

He is a quiet man but next time he must be better prepared with information so that the government does not fall a victim to attacks by critics," he said.

Free translated : The government should have seen this coming and need to be prepared to cover it up way in advance the next round. That is IF there is a next round for this government.

[SICHONSTEVE]

I don't see the price of rice dropping in the supermarkets. It seems they would rather let all this good rice rot away than sell it at a good discount for the general population. Selling it locally might not make a big dent in the stockpile but it would certainly make a lot of people happy & ease the cost of living.

Nah!! never work, too sensible for Thailand and difficult to make pocket money from.