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Rice subsidy scheme backfires on Thai government

Support wanes as angry farmers await payments

Stephen Steele, Bangkok

Stephen Steele, Bangkok

Updated: February 12, 2014 08:24 PM GMT
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Rice subsidy scheme backfires on Thai government

Farmers occupy the grounds of the Ministry of Commerce in Bangkok during a protest over missing government payments from the previous rice harvest. (Photo by Stephen Steele)

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When Sasita Kiahan, a mother of three and a rice farmer in Thailand’s Isaan region, contemplates the amount of debt her family has, thoughts of suicide cross her mind.

“I do think of killing myself. I have thought about it several times. But then I think of my children and I stop. I think about what will happen to them,” she told ucanews.com during an interview at Christ the King Church, a Catholic parish in Nakhorn Ratchasima's Khong district.

Sasita, like thousands of other farmers throughout Thailand, has not been paid for her previous harvest and is owed about $6,000 through a complicated and controversial rice subsidy scheme promoted by the Thai government, which initially paid the farmers above market price for each harvest.

The scheme was the centerpiece of an election platform that helped sweep current Prime Minister Yingluck Shinawatra into office in 2011. And it’s the same program that might run her ruling Pheu Thai Party out of power in the coming months.

Reports of farmers killing themselves over mounting debts and withheld payments have emerged from Thailand's north and northeast and may prove to be the biggest obstacle the Yingluck government faces as it struggles to maintain its fragile grip on power.

In the more than two years the scheme has been in effect, Thailand has dropped from the world's top exporter of rice to third, with an estimated 18-20 million tons of rice stockpiled across the country.

Opposition politician Dr Warong Dechgitvigrom accused the government of rampant corruption, saying the program was designed to seal votes to keep the Pheu Thai Party in power and to siphon money meant for the farmers into the pockets of party leaders and their supporters.

A deal to sell 1.2 million tons of stockpiled rice to China collapsed recently amid an ongoing corruption probe.

Dr Warong, who has submitted several complaints to the National Anti-Corruption Commission over the past two years, told ucanews.com that he had evidence that the China deal was brokered by sham Thai companies connected to the Shinawatras.

“The Chinese were never involved. Every aspect of this program has been corrupt,” he said.

The voter-rich north and northeast region formed a power base for Yingluck and her billionaire brother, former prime minister Thaksin Shinawatra, almost guaranteeing their party victory in any election. But the farmers, who have not been paid since November, appear to be slowly withdrawing their support.

Farmers have been staging their own protests, separate from the months-long Bangkok-based demonstrations that have sought to overthrow Yingluck’s government. On Monday, more than 1,000 farmers protested outside the temporary government headquarters in Bangkok demanding payment, while farmers in the north and northeast have blocked roads and marched on government buildings in their home provinces.

Rice farmer Phol Mesil of Khong district said he had been a strident supporter, known colloquially as “red shirts,” of the Shinawatras. But the 67-year-old said he has withdrawn his support because the party abandoned their promise to pay the farmers.

"At first, we supported them because we made more money. We believed them. But Thaksin has divided the people of Thailand and for that reason, he and his family must go," he told ucanews.com.

An absence of communication from the government has frustrated farmers further, Phol said.

"We learn about this from watching the news. The government never contacted us," he said.

Phol is part of a group of about 200 Catholic farmers who live in the village and attend Christ the King. The parish maintains a revolving account of about $1,500 that it uses to help reduce parishioners' debts, buy food and keep the villagers' children in school, said Stigmatine Father Philip Pornchai Techapitaktham.

"The people here are very poor, very poor. We collect about 200 baht [US$7] each week at Mass. We do what we can, but there’s not enough to help everyone," he told ucanews.com.

Farmers in Thailand’s arid northeast have one harvest a year, unlike other regions that produce two or three. They have one shot to earn income to sustain them until the next harvest and any deviation from that centuries-old schedule can prove calamitous.

A disaster was what Vitthaya Inala, an elected senator from northeastern Nakhom Phanom province, predicted shortly after the rice subsidy scheme went into affect.

“This program did not have the future in mind. It was done just to win an election,” Sen Vitthaya, vice chairman of the Senate’s Committee on Economics, Commerce and Industry, told ucanews.com.

The scheme, he said, became a “black hole of corruption” that resulted in rising mountains of debt, millions of tons of unsold rice and about a million unpaid farmers.

The farmers are owed about 130 billion baht by the government, which doesn’t have the money or the ability to borrow in order to pay, he said.

In one of his final acts as an elected official, Sen Vitthaya, whose six-year term ends on March 1, presented a plan to the Senate on Wednesday requiring the Pheu Thai Party to pay the farmers.

The senator’s plan would require the party’s 200 MPs to pay 1 million baht and Yingluck to pay at least 1 billion baht to the farmers to offset what the government owes.

“Before we do anything, the farmers must be paid. They did not do anything wrong,” he said. “It was the Pheu Thai Party that made this promise and it was this promise that get them elected. I think it’s right then that they pay this debt. Yingluck has the money,” he said.

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