Korn on military spending but not electoral buying power

7 03 2011

For those who enjoyed the first part of Asia Provocateur’s interview with Finance Minister Korn Chatikavanij, the second installment is now available.It is a long interview, so PPT just highlights bits and pieces from Andrew Spooner’s blog.

On food security and prices and the challenge for the Democrat Party: “From my perspective the high cost of living is a big issue…. Actually, the people who are hurting more are the urban dwellers and consumers, who don’t have the benefits derived from higher food prices. That is problematic as it is also the Democrat Party’s support base. So it is a challenge for us.”

Korn adds that the government has “scaled back on our spending programmes, which is consistent with our plan to achieve budget balance in five years.” PPT wonder what impact the huge pre-election spending is having on the budget bottom line. Korn speaks about the “oil fund” saying that, when the interview was conducted it had a surplus of 27 billion baht. Estimates are now that it will be drained by April.

Korn goes on to mention the government’s Pracha Wiwat program, saying “… all of it is address the quality of life issues that have been raised as a reason for social division and to strengthen the grassroots economy…”. He also comments on social spending spurring demand. The unmentionable is influencing the election outcome.

Like Abhisit, Korn likes to claim: “We did something that wasn’t done before.” IOn this case he is referring to flood relief, where he says: “We wanted to ensure that everything was received by the individual recipients with no leakage along the way.” Maybe Korn has forgotten this. And what could be done about corruption when the Minister doesn’t know the figure for this huge program?

Referring to the reported level of investment in the Pracha Wiwat programme of 2 billion baht (US$65.6m) a year…

That’s totally wrong. It’s more. Well, that’s right for the first year anyway.

Well the Bangkok Post state that it is 2 billion baht.

Okay, okay. Roughly.

Spooner then asks this really neat question:

And I am referring to the level of Pracha Wiwat investment in this next question as it seems quite a surprising state of affairs to an outsider such as myself when set against payments in other areas. For example, when we consider the amount of money put aside to spend on Privy Council president General Prem Tinsulanonda’s new cavalry unit in Khon Kaen, which costs 70 billion baht (US$3.3bn), equivalent to 35 years of the Pracha Wiwat welfare programme, and a military project that some commentators consider to be something of an unnecessary vanity project, I must wonder, and speaking very much as an outsider on this issue, but also having observed other grandiose spending, is military spending out of control in Thailand? And, given all the reforms and changes you are talking about, when are Thais going to be able to ensure they get the best value for money from their military? Setting 2 billion baht against the military spending seems very small.

Korn gets back to his comment above:

Pracha Wiwat is just a sliver of what we do in terms of welfare. Income guarantee for farmers is over 40 billion baht. Free education is another 30 to 40 billion baht. We pay 500 baht to elderly people who don’t have a pension that, again, is tens of billions of baht.

So that’s annually up to 150 billion baht plus tens of billions to the elderly. Korn gives these figures as a defense of the claim that welfare amounts to a sliver of what the military has been paid.

Korn then turns to the military part of the question. The Finance Minister states: “I have no idea about the Khon Kaen thing.” This would seem to imply that the military gets its piles of money and uses it with no oversight from the government.

He adds:

The less money we need to spend on the military the better…. But … of course we need to have a military, then they need to be properly equipped. And on that basis we need to be willing to spend money to ensure that we’re getting the best value from our military.

Yes, Minister, but how can you get “best value for money” if you have “no idea” what they are doing with their budget? And what of failed zeppelins, “lost” arms, GT 200s and so on?

Finally Spooner  asks about Map Ta Phut, environment and development. Korn essentially says on Map Ta Phut: “We solved it in a timely manner and in a very democratic manner…”. PPT isn’t at all sure the issue is “solved.”

Strikingly, Korn adds:: “The reason the country is spending quite a lot of money in helping Myanmar (Burma) develop, for example at the new port city of Tavoy, is because that is where our industrial growth is likely to be in the future and not within Thai borders.” While it is understood that this is Thai policy, it hasn’t been so clearly expressed. Move polluting and dangerous industries to other, neighboring countries. Charming idea.

It is a very useful interview and Korn seems pretty relaxed. We wish he’d been asked about elections and government spending.


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9 03 2011
On the pre-election splurge | Political Prisoners in Thailand

[…] On the pre-election splurge The Financial Times has noted the Democrat Party-led government’s huge pre-election spending. PPT’s most recent comment on this spending here. […]

11 03 2011
Korn on staying in power | Political Prisoners in Thailand

[…] Andrew Spooner at Asia Provocateur has posted the third installment of his interview with Finance Minister Korn Chatikavanij. For PPT’s posts on the second part of this discussion, see here. […]




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