Jatuporn says loan plan faces challenges
The government could inflict severe or even fatal wounds upon itself if it pushes the controversial digital wallet scheme, says one of its fiercest critics.
The ruling Pheu Thai Party cannot be trusted to carry out the policy after reneging on promise after promise, Jatuporn Prompan, a former red-shirt leader and co-leader of Kana Lomruam Prachachon (Melting Pot Group), said during a live-stream on Facebook.
Mr Jatuporn was referring to campaign promises by Pheu Thai, particularly its initial pledge not to form a government with former coalition parties under the previous Prayut Chan-o-cha administration.
The Pheu Thai Party later ditched the Move Forward Party (MFP), its pro-democracy ally, to set up a government with Bhumjaithai, Palang Pracharath and the United Thai Nation Party, the three core parties of the previous administration.
Mr Jatuporn said the government had also revised the wallet policy amid growing criticism, including an about-face on its financing. It now wants to issue an act to allow for half a trillion baht in borrowing to pay for the scheme.
Earlier, Premier Srettha Thavisin said no loan would be procured to execute the flagship policy.
Mr Jatuporn said the proposed loan via an act might run into legal hurdles as it must be carried out within the framework of the State Fiscal and Financial Responsibility Act, which deals with limits for emergency funding.
If the loan was an urgent measure, as the government claimed, it should be obtained through an executive decree, not an act, according to Mr Jatuporn.
An executive decree authorises the government to launch a policy to tackle a crisis at hand and return the policy for parliament’s approval later.
“The government should have opted for the decree, not an act, to justify its cause. It’s just full of contradictions,” he said.
The government has reiterated the urgent need to offer the 10,000 baht handout as a stimulus measure to Thais aged 16 and older who earn less than 70,000 baht per month and have under 500,000 baht in bank deposits.
Based on these criteria, an estimated 50 million people will be eligible — down from the 56 million intended originally.
Deputy Finance Minister Julapun Amornvivat said the government needs to stimulate the economy, which is the aim of the digital wallet project.
“If we continue to allow the economy to expand by 2% per year while the government maintains a budget deficit of 600-700 billion baht annually, by 2027 the public debt will exceed 70% of GDP, above the ceiling in the fiscal discipline framework,” he said.
He said stimulating the economy so it can expand at an average level of 5% per year will help reduce the public debt-to-GDP ratio in the medium term because when GDP expands, the ratio will narrow.
“If we don’t do anything and allow the government’s public debt to exceed 70%, the country’s credit rating would be derailed,” said Mr Julapun.
However, Mr Jatuporn said some members of the Council of State — which is set to vet the bill seeking to borrow 500 billion baht to fund the scheme — might find the bill falls short of being legal.
“Failing to survive scrutiny by the Council of State, the government’s legal arm, is the least of the political injuries bound to be inflicted on the government,” he said. The more hurtful “wound” would be for the measure to attract inadequate support from coalition parties in parliament, he added.
“The underlying question here is whose fault would it be if the scheme didn’t pull through. Mr Srettha might have to face the music and become the political sacrificial lamb,” he said.
Meanwhile, Thanathorn Juangroongruangkit, head of the Progressive Movement, said the 500 billion baht earmarked for the policy would be better spent revamping public transport, public health, the environment, and the education and water reticulation systems.