After the 2001 Election of the Thaksin Government

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With the election of the new government of the Thai Rak Thai Party in

early 2001, led by Dr Thaksin Shinawatra, six new programs were initiated,

with the stated objective of assisting the poor. Together, these programs

were called the Grass Roots Economic and Social Security Program. The

six component programs are:

• The Debt Moratorium for Smallholding Farmers program

• The Village Fund program

• The One Tambon One Product program

• The People’s Bank program

• The New Entrepreneur Promotion program

• The Health Security for All program (30 baht Health Card

scheme)

Table 5.9 shows the budgets of each of these programs since their inception.

The second and sixth are by far the most signifi cant. Both involve large fi scal

outlays. For example, the Village Fund scheme injects one million baht per

village. Since there are around 75 000 villages in Thailand, this amounts to

75 billion baht, or close to US $2 billion. Although it was fi rst thought that

the funds would be grants, it was subsequently announced that they would

be loans. None of these six programs is explicitly targeted towards poor

people. Because the services offered under the 30 baht Health Card are very

basic, according to media reports a signifi cant element of self-targeting is

almost certainly involved. Many of the non-poor will elect to pay for better

treatment than is available with the 30 baht card.

None of these programs is explicitly poverty-targeted, in that it is

specifi cally designed to favor poor over non-poor households. Nevertheless,

because of their magnitude they are signifi cant. Data on the allocation of

these funds by province or by income category of recipient households are

not available and it is therefore not yet possible to analyze their distributional

effects. These programs are additional to the regular poverty reduction

budget of the government, which is larger and for which disaggregated

provincial level data have been obtained for the purposes of this study.

Table 5.9 Grass roots economic and social security project: 2001–2003,

budget (millions of baht)

Project 2001 2002 2003 Total Share (%)

Debt Moratorium for 2371 9325 6718 18 414 9.0