Skills training and jobs creation highlight welfare reform
Breaking with over a decade of focusing on populist-style subsidies as a means of assisting low-income people, the government of Prime Minister Prayut Chan-o-cha said last week it will concentrate on skills training and jobs creation during the next phase of its welfare programs in order to create sustainable solutions to reducing inequality in society.
Traditionally, assistance to low-income earners has come in the form of various types of subsidies for essentials such as food, fuel, power and transportation. Some programs involved loans and a few focused on cash handouts. Those types of programs were criticized in some quarters as short-term measures that were unsustainable and created dependency. More cynical assessments dismissed them as vote-buying mechanisms by politicians.
While the current government intends to keep several subsidies – withdrawing them suddenly would lead to hardship – it is looking to create programs that will build skills, resilience, and lead to more enduring solutions for low-income people. Greater skills leading to better jobs would also be an important step towards reducing the disparities that have helped fuel social and political unrest during the past decade.
“The objective of the second-phase program is not necessarily to offer everything for free,” said Somkid Jatusripitak, a deputy prime minister who oversees the economic ministries and is a key architect of the Kingdom’s economic policies.
The objective of the second phase, he said, is to provide low-income people with marketable skills so they can obtain higher-paying work and lift themselves up by their own bootstraps.
To do that, the deputy prime minister has ordered state agencies and ministries to develop skills training programs in fields in which they specialize. They must also develop job creation projects and programs.
The Bank for Agriculture and Agricultural Cooperatives, for instance, has been tasked with developing skills programs and creating jobs for farmers.
Somkid also directed the bank to ensure farmers have more access to capital. Farmers pay a 7 percent interest rate for loans, as apposed to 5 percent for the business sector. Somkid said the rate should be lower for farmers as they have less financial resources.
The government estimates there are 3.96 million Thais classified as living below the poverty line, which in Thailand is $931 a year. One million of those living below the poverty line have taken loans from the Bank for Agriculture and Agricultural Cooperatives.
Deputy Agriculture and Cooperatives Minister Luck Wajananawat said the government will soon create a national operations center devoted to reducing poverty and Prime Minister Prayut Chan-o-cha will be the chairperson.