South left out of emergency flood loans, Abhisit charges

The government is discriminating against flood victims in the South as they will not get financial assistance from a soft-loan package authorised by an emergency decree, opposition leader Abhisit Vejjajiva said yesterday during a parliamentary debate on two decrees.

Moreover, some private firms that deserve to receive assistance will not get soft loans because of a flaw in the decree, said the Democrat Party leader, who also questioned the adequacy of the planned insurance fund and its management transparency.

Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong yesterday presented two emergency decrees to the House of Representatives, citing the urgent need to boost public and investor confidence and to revive the fortunes of households and businesses hit by last year’s severe flooding.

One decree orders the Bank of Thailand to provide a soft-loan package worth Bt300 billion, while the other authorises the Finance Ministry to borrow Bt50 billion for the establishment of an insurance fund.

Kittiratt also referred to another two emergency decrees pending in the Constitution Court.

The first concerns the management of Bt1.14 trillion of debt incurred by the Financial Institutions Development Fund, and the second concerns the plan to borrow Bt350 billion to finance post-flood reconstruction projects.


Meanwhile, the Constitution Court yesterday accepted the case filed by the Democrats and MPs, who asked the court to verify whether the two executive decrees on government debts and loans were in contravention of the charter.

These two decrees are also part of the wider package to revive the country after last year’s floods and prevent future devastating flooding, as well as to invest further in infrastructure projects.

“What we have to do concerns one word: confidence,” said Kittiratt, as he conceded that the unprecedented flooding had caused the local and international communities to lose confidence in the country.

Abhisit said the opposition agreed there was an emergency requiring the first two decrees, but there was no reason to issue the other two with such urgency. Although supporting the urgent need to provide soft loans to help flood victims, he criticised the government for not treating those affected equally.

“Under the soft-loan decree, flood victims in the South are not eligible to get the loans, so the government has to change this. And if the government does not do it, we the opposition will propose changing this legislation after Parliament approves the decree,” said the former prime minister.

He also pointed to what he said was a loophole in the decree, in that it covers only households and small and medium-sized enterprises.

“Those firms damaged by floods but not defined as SMEs will not get soft loans. The government should give them loans if they are part of the production chain,” he said.

Abhisit also questioned the adequacy of the Bt50-billion insurance fund. It could be too small compared with flood-protection insurance claims worth about Bt200 billion last year, he said. The insurance decree also gives too much power to the fund’s management team, which will be chaired by Kittiratt, he argued.

Nor does the decree set out the criteria for the qualifications of insurance committee members, which means they may not have the necessary knowledge and some of them may have conflicts of interest, which could negatively affect the public interest, he said. “The way the government is issuing decrees is one of secrecy and a lack of public participation, so it results in flawed legislation,” he added.

Kittiratt responded that that the size of the insurance fund was adequate, since the government was also investing in flood-prevention measures that should minimise damages in the event of a recurrence of severe flooding.


Pin It on Pinterest