The decision by Commerce Minister Chaiya Sasomsap to grant amnesty to more than 40 blacklisted rice millers to enable them to participate in the rice-pledging programme is not welcome. Why has Chaiya considered the amnesty for these rice millers with negative records as a priority during his first days in office? There are a number of urgent issues worth more of Chaiya's attention than these millers.
First of all, the blacklist was set up to punish rice millers who earlier breached the ministry's regulations. The government set damage fees plus interest to penalise them. Those who fail to comply will be blacklisted from the government's future rice pledging programmes. The punishment clause is meant to serve as an example for those intending to commit wrongdoing - which could affect the implementation of the rice policy. Some of these rice millers committed to provide rice to the government but they didn't have enough rice in stock at the time of delivery. They had sold rice ahead of the contract to cash in on the swift movement of rice prices.
The Commerce Ministry thus blacklisted these millers and prohibited their companies from participating in the rice-pledging programme unless they paid the damages. Currently, some 40 blacklisted rice millers owe a combined Bt1.4 billion to the government. However, Chaiya said on Monday that he planned to pardon these millers by waiving the requirement for them to pay the interest rate on the damages. If they can pay back the principal damage fee, they will be allowed to participate in future rice-pledging programmes.
The Commerce Ministry is being lenient with these blacklisted millers who are currently facing criminal lawsuits. The ministry will consider whether each miller should be taken off the blacklist. Legal action against some millers may be withdrawn if they are not in serious breach of any regulation or didn't commit wrongdoing intentionally, said Chaiya.
Chaiya hastily announced his plan to pardon the rice millers ahead of the upcoming harvest in November. A substantial amount of paddy is expected to enter the market during the main harvest. The Samak government earlier announced a policy to buy rice at a guaranteed price of Bt14,000 per tonne. Thus, whoever is eligible to participate in the government's programme is expected to reap the benefits of the high price.
Chaiya said the amnesty plan is essential. "I am not afraid to be seen by society as favouring a certain group of millers because if none of the millers participates, then the rice-pledging programme would be useless. Besides, the government should not be adversely affected by the amnesty because the state will get the principal damage fee back from these millers."
Chaiya's statement is not convincing. First, people in the rice-milling business confirmed that the non-participation of the blacklisted millers would not have any impact on the execution of the government's policy at all. There are some 1,000 other rice millers who are not blacklisted and are ready to participate in the programme. Therefore, there should be a sufficient amount of paddy for the rice-pledging programme. Secondly, the planned amnesty will create a moral hazard because - if the Commerce Ministry lets those who committed wrongdoing get away with their crimes - they might be tempted to do so again.
The government earlier set the severe punishment clauses because rice is the most important crop for the Thai economy. The disruption of the rice trade, or any irregularities, could dampen the country's reputation for exporting rice. The blacklist was meant to warn people that they will have to pay for their errant actions, so all rice millers should act in a responsible manner. Rules should not be bent. And the Commerce Ministry should not set an example that wrongdoing is acceptable in certain circumstances.