Thailand Slashes Provincial Budgets by 20 Billion Baht for FY2027, Cites Redundancy

The Office of the Budget in Thailand has announced a significant reduction in provincial and cluster budgets for fiscal year 2027. The budget for provinces and provincial clusters will be slashed from 26.33 billion baht in FY2026 to 4.284 billion baht in FY2027, a decrease of approximately 20 billion baht. Anan Kaewkamnerd, Director-General of the Office of the Budget, explained that the primary reason for this reduction is the redundancy between provincial/cluster budgets and the functional budgets of various government agencies, citing water management as an example. By streamlining these budgets, funds will be reallocated to more necessary projects, enhancing fiscal efficiency. The remaining budget will focus on promoting careers and diversifying tourism to ensure citizens do not miss out on opportunities. "The adjustment of provincial and cluster budgets is intended to ensure that budget utilization is more targeted according to government policy," Mr. Anan stated. "We are reducing redundant budgets already being handled by various agencies and focusing on practical, area-specific initiatives such as career promotion, tourism, and public services. Some of this funding will directly reach the villagers without duplication." Regarding civil servant salaries, a portion of the FY2027 budget includes 13 billion baht in the central budget for salary increments and professional adjustments, the same amount as the previous year. However, this will not involve an increase, reflecting the current high proportion of the budget allocated to regular expenses. New items in the FY2027 central budget include 12 billion baht for expenses related to addressing and recovering from crises, as well as mitigating the impacts of energy price volatility. This fund is a contingency for uncertain situations, as the impact of high energy prices may not subside quickly and could lead to a continuous economic slowdown. The utilization of these funds will be governed by administrative regulations, similar to those for economic stimulus measures. Furthermore, the reserve for emergency and necessary expenditures in the central budget for FY2027 has been set at a substantial 100 billion baht. This is deemed necessary due to the rapid global changes, including droughts, natural disasters, and fluctuating oil prices, requiring adequate preparation to care for the public. Regarding the FY2026 central budget for emergency and necessary expenditures, ongoing urgent needs continue to be addressed. A budget transfer of 10.3 billion baht is currently awaiting parliamentary approval. Once approved, expenditures will follow existing regulations. Any remaining funds may be considered for debt repayment. "For the remainder of FY2026, there will likely be no need for additional measures to accelerate budget spending," Mr. Anan noted. "We have reported to the government that this fiscal year's budget expenditure is the highest in decades. Particularly in the last month of the third quarter, the expenditure rate reached 82%, significantly exceeding the spending plan. This is a result of the government's efforts to accelerate investment budgets to drive the economy. Whether the 100% target will be met remains to be seen. We also wish to emphasize the efficiency of budget spending concurrently." Source: INN News