The May 14 election campaign has become like a year-end sale, with vendors digging out every discount, perk and freebie to woo buyers.
The key difference is that the populist policies on the campaign trail are just promises. They are not legally binding, and whether they are realised or not depends on the sincerity of the parties concerned.
Voters may recall that a raft of promises by the ruling Palang Pracharath Party (PPRP) during the last round of electioneering in 2019 — such as its vows to reform the police and suppress corruption among the bureaucracy — have all come to naught.
But other parties’ promises have been honoured in the past and have benefited the public.
One example of this would be the universal 30-baht health security scheme, initiated by the now defunct Thai Rak Thai Party over a decade ago, which has become the hallmark of the Thai health system for the whole social spectrum.
Among the populist policies proposed by political parties campaigning for the May 14 election, Pheu Thai’s promise of a 10,000-baht one-time giveaway to every Thai national above 16 years of age appears to be the most controversial.
It has certainly been subjected to the most criticism by rival parties because it involves state funding and would cost an estimated 540 billion baht. But the fact of the matter is there are other big spenders who will make this look like kid’s stuff.
For instance, the PPRP’s stated policy of supporting pensioners to the tune of 3,000 baht a month — for Thais who are over 60 — 4,000 baht a month for those over 70 and 5,000 baht a month for those over 80 will cost taxpayers about 2 trillion baht over four years.
Then there is the welfare card programme touted by the United Thai Nation Party, with its promise of an allowance worth 1,000 baht a month for each of the 14 million poor Thais. This would cost taxpayers about 466 billion baht over the same duration.
Or what about the Thai Liberal Party’s pension scheme? This would apply to the nation’s 8.3 million pensioners above 65. According to the policy, they would each receive an allowance of 3,000 baht a month, costing taxpayers 1.19 trillion baht over four years.
All populist policies involve free handouts so the public can spend more and make a living. The common objective is to increase their purchasing power, which would help drive the domestic economy and stimulate economic growth. Yet it would deplete the annual budget and mean less money for other projects, while eating into the investment budget.
To offset the spending on populist policies, the government must increase its revenue, or it will have to borrow more, thus worsening the level of public debt. Ergo, there is a need for fiscal discipline to prevent overspending.
Yet, little has been heard from the parties about how they will source additional revenue to offset the staggering spending to fund their populist policies. Or will they tax the rich more?
Populist policies that only serve to increase the purchasing power of the public may power the economic engine, but only for a short period unless more money is injected into it, which no sensible government can afford.
The policies must help people increase their income or improve their skills so they can move up the career ladder and support themselves independently, which should be the ultimate objective of these policies.
