Listen to this story
The chosen slogan that Prime Minister Srettha Thavisin has adopted for his administration is “Chance of Possibility.” In English it is an awkward slogan, to say the least. In Thai it is slightly better: “this is the opportunity for every possibility.”
In his first few months, however, one possibility has seemed to have little opportunity to become true: that Srettha would be able to make a breakthrough in public opinion. The prime minister came to office essentially without a honeymoon period. The protracted and unseemly process in which his party had to deny Move Forward’s claim to power ensured that Srettha would not emerge unscathed from these proceedings.
It was unsurprising, then, that Srettha and the Pheu Thai Party would focus their recent report on Srettha’s first 60 days in office on a series of “quick wins.” Energy bills were quickly lowered, reduced train tickets were trialled, Visa-free travel for more foreign nationals was implemented to jumpstart tourism.
Many of these quick wins to alleviate financial burden were important, to be sure, although the sustainability of some of these policies in the long-run are questionable. But Srettha is already arriving at a new challenge of his own making: the 10,000 baht handout policy that the Pheu Thai Party had trumpeted as its signature policy pledge during the election.
As I wrote last month, policy experts have been vocal in criticizing the policy. Worse for the prime minister, however, they now have more ammunition to fire. Srettha broke his own pre-election pledge that the government would not borrow any money to fund this policy. Instead, the prime minister now acknowledges that loans under a royal decree will be needed.
This much has always seemed inevitable; funding this policy without any borrowing always seemed implausible. The party had claimed that these funds would come from increased state revenue owing to economic growth and other regular budgetary processes. Now the prime minister has been forced to acknowledge economic reality.
Given that Pheu Thai had to break so many political promises to get in power, breaking one more to unlock their key economic policy is hardly surprising. Srettha now runs into two further roadblocks here, however. Firstly, borrowing so much money to fund a one-time handout is still difficult to explain away, not least when critics of the previous administration often said that Prayut had borrowed too much.
Secondly, critics from across the political spectrum are now questioning whether or not the borrowing bill would even be legal. Section 53 of the State Fiscal and Financial Disciplines Act (2017) states that a special bill to borrow can only be passed when “a national crisis must be dealt with urgently and continuously, and the annual budget cannot be used in time.”
Of course, Srettha’s government do have the votes for such a bill to pass, if it does survive legal scrutiny. It would require votes from Srettha’s coalition partners, many of whom vehemently campaigned against a similar borrowing bill that was ruled unconstitutional under the Yingluck administration. (Doesn’t that feel like several political lifetimes ago at this point?)
But in any case, the economic crisis stemming from the Covid lockdown is now essentially over, even if lingering weaknesses remain. For the government to claim a national crisis to justify this borrowing would be difficult indeed.
It is too early to say how Srettha’s premiership will fare. His government is still young; he has not even hit the 100-day mark in office. But the heavy focus on this ill-considered 10,000 baht handout policy still threatens to overwhelm any of his other projects. The land bridge in southern Thailand, an ambitious policy that deserves greater debate? His stated commitment to continue supporting economic restructuring and innovative S-curve industries? His flurry of international visits and foreign policy decisions?
All of this may get lost as the opposition smells blood on the controversy surrounding the 10,000 baht policy. At that point, even the ‘quick wins’ Srettha has achieved — which are unlikely to have moved the needle much in the first place — would not be enough to save him. Srettha needs to switch gears if he wants to have a chance at the possibility of ensuring his premiership is successful.