The Thai Senate gave the go ahead today (Monday) for the Finance Ministry to guarantee the 130 billion baht debt incurred by the Office of Oil Fuel Fund, as a result of the government’s policy of subsidising the price of cooking gas during COVID-19 pandemic.
Before the pandemic, the Office of Oil Fuel Fund had a reserve of 36 billion baht, which was used for the subsidy. The pandemic dragged on for about three years, however, while the global prices of imported cooking gas and oil increased steadily, resulting in the Fund running up a huge loss, with its reserve fund depleted and having to borrow more.
Senators debated this issue today before agreeing, by a majority, to endorse the Finance Ministry’s plan to guarantee the Fund’s debt.
Senator Sathit Limpongpan said that the Fund must strictly maintain financial discipline and exercise caution in the spending of funds borrowed to subsidise cooking gas. He also suggested that the Fund must have a clear plan of the debt repayments.
Another senator said he agreed that cooking gas subsidies are necessary, otherwise the domestic price may rise to about 45 baht/litre which would fuel inflation.
A total of 187 senators voted to support the Finance Ministry’s guarantee plan. One voted against and there were five abstentions.
