Academic journal article Asian Social Science

A Proposal on the Decentralization of the Tasks in the Liquid Petroleum Gas Price Compensation Policy for Low-Income Households by Local Government Organizations in Thailand

Academic journal article Asian Social Science

A Proposal on the Decentralization of the Tasks in the Liquid Petroleum Gas Price Compensation Policy for Low-Income Households by Local Government Organizations in Thailand

Article excerpt

Abstract

Due to the retail price of Liquefied Petroleum Gas (LPG) having been raised by the Thai government by 0.50 baht per kilogram each month for 12 consecutive months from September 2013, by October 2014 the price is going to reach 24.82 baht (0.83 dollars) per kilogram. It affects the consumers' cost of living extensively and it has caused a massive protest. Accordingly, a price compensation policy has been employed in order to maintain the retail price of LPG for low-income citizens at 18.13 baht per kilo for 1 year. SuanDusit Rajabhat University's SuanDusit Poll was assigned to conduct a census of households', small restaurants', and food shops' LPG usage; however, there was dissatisfaction with the census result. Similarly, certain local government organizations (LGOs) in Thailand were also assigned to collect additional data to promote the policy in local areas, and to assist people to buy LPG via a mobile system. However, the LGOs have not been able to assist people effectively as required, since the process outlined above has not been operated by the LGOs from the outset. In this paper, the author argues that to assign the university to collect data was impractical; further, the failure to give the assignment to the LGOs portrays ignorance of the LGOs' responsibility in terms of local government organization and it also significantly overlooks an important principle of decentralization theory. In summary, it is suggested that for future local policies or projects, the government should decentralize those tasks to the LGOs directly since the LGOs operate for the benefit of local people; as a result, the people would have their needs met and the tasks would be run smoothly, effectively, and worthily.

Keywords: decentralization, decentralization of tasks, local government organizations in Thailand, liquefied petroleum gas price float, price compensation policy for low-income people

1. Introduction

Liquefied petroleum gas (LPG) is commonly used for cooking in Thailand, and therefore many small restaurants and food vendors, who are mostly poor, must use it for earning a living. With this in mind, the previous populist government did not increase the price since it would potentially affect the people in their political stronghold areas. Though the LPG market price is higher than the fixed price of 18.13 baht per kilo, the difference was subsidized by using money from Thailand's Oil Stabilization Fund (Oil Fund).

However, the Yingluck Shinawatra government has emphasized that the reasons for increasing the price are: 1) to be fair to people who pay taxes so that they do not pay an additional rate to stabilize the LPG price; 2) to help balance the Oil Fund in the last few years (from 2008-2012) because it had to provide around 4,000 million dollars to fix the LPG price And if the price were not raised, by 2015 the government would have to spend around 6,500 million dollars on balancing the LPG price; 3)to limit this particular channel of LPG usage as the household LPG price for cooking is cheap and stable compared with the industrial or transportation LPG price which has resulted in some people trying to illegally use household LPG in industrial and transportation activities; 4)to eliminate the smuggling of LPG across borders since it is only 18.13 baht/kg. in Thailand, but it is 59 baht/kg. in Vietnam, 49 baht/kg. in Laos, 45 baht/kg. in Myanmar, 34 baht/kg. in Indonesia, and 20 baht/kg. in Malaysia; and 5) to float the price so that it is the same as the world market price (SuanDusit Poll, 2013a;The Ministry of Energy, 2012).

The LPG price has increased, and is increasing, all over Thailand since September 1, 2013 at 0.50 baht per kilogram per month for 12 months continuously; therefore, by October 2014, the price is going to reach 24.82 baht per kilogram and it is expected that it will reach 30.13 baht within 2015. The government explained that adding to the LPG price at 0.50 baht/kg. …

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