Legal Issues of Government Borrowings under Special Decree

Abstract

Government borrowing is one of fiscal tools which widely used in many countries when the governments need money to spend for a number of reasons. Government borrowing is one of the public debt which can be classified as in-budget and off-budget borrowings. This article addresses off-budget borrowings under the State Fiscal and Financial Disciplines Act, B.E. 2561. In the past, there were problems that the government was increasingly using its borrowings by enacted special decrees and Section 53 of the State Fiscal and Financial Disciplines Act, B.E. 2561 was enacted for the purpose of solving those problems. Section 53 sets the framework for special legislation to be more stringent. It controls the use of the executive powers and discretion of issuing the borrowings laws and trying to solve the problems of borrowing legislation in the past.  Although this law has the advantage that, at least, Thailand has a new legal framework that governs fiscal discipline which may clearly control public debt both in-budget and off-budget. But this law allows the government to issue special laws to borrow money off-budget by specifically enacted the law if there is an urgent and ongoing needs of resolve the country's problems and in the case that it is not possible to use the normal annual budget process. But there is still some concerns that this type of legislation may open the door to the government to use Section 53 of the State Fiscal and Financial Disciplines Act, B.E. 2561 as an excuse for enacting special laws by using the urgent grounds. Therefore, control methods may be implemented by scrutinizing the spending and reporting the spending to the Parliament in order to maximize benefits to the public.