MFP outlines handout risks

The Pheu Thai-led government’s digital handout scheme could exhaust the country’s capacity to handle large-scale emergencies, claims the main opposition Move Forward Party (MFP).

This is one of the three possible worst-case scenarios resulting from the 500-billion-baht programme expected to be launched in the fourth quarter of this year, the MFP said yesterday.

MFP list-MP Chulapong Yukate, an experienced banker, said the three scenarios could occur if the implementation of the digital wallet scheme failed to meet its economic stimulus targets.

In the first scenario, protracted wars in the Middle East and Europe and brewing conflicts elsewhere could trigger a global economic crisis next year.

If this occurs, he said, Thailand risks being badly affected due to its limited financial resources, which would be substantially sapped by the handout scheme.

The country would have little capability left to fend off external financial danger, said Mr Chulapong.

At the same time, the government can never rely solely on tax revenue to fully stay strong financially as it accounts for only 13.7% of its gross domestic product (GDP), he said.

Compared to the average tax revenue collected in developed countries, which is 35% of their GDP, Thailand’s tax revenue has dwindled from 17% of the GDP to 13.7% at present, he said.

“In short, we are overspending with limited earnings,” he said.

The second scenario is that the wallet scheme will result in insufficient funds left for other policies to assist farmers and the poor and low-income earners or small businesses. These sectors and communities all play an important role in the national economy, he said.

The last scenario is the risk of largescale corruption due to the scheme, he said.

The technology used for the handout, if not managed properly, will make it prone to graft, he claimed.