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FEATURE STORY

Thailand Public Finance Management Review Report

May 10, 2012

Key Findings

  • Thailand’s strong economic growth over the past decade has recently seen it graduate from a Middle to an Upper Middle Income Country in the World Bank classification. Economic growth and a corresponding improvement in access to and quality of public services has been concentrated in Bangkok and the central region, leaving significant deficiencies in other parts of the country including the North and Northeast and contributing to unequal human development outcomes. Addressing these issues will be a key step in Thailand's continued development towards high-income country status.  
  • Currently, 72 % of Thailand's general public expenditures are being spent in Bangkok, which is home to 17% of the country’s population and produces 26% of the GDP. In contrast, the Northeast, which holds 34 % of the country's population, receives 6% of the expenditures.
  • Looking ahead, Thailand could focus on improving the efficiency and effectiveness of public spending to help counteract regional disparities in human development and inequality. Thailand’s expenditure policy can be refocused towards service delivery deficient areas to raise the services delivered in those areas to similar standards as in Bangkok.
  • Another key issue for Thailand is ensuring that the inter-governmental fiscal framework is properly constituted to support more efficient and accountable service delivery of public services across the country. Current monitoring and evaluation systems can be further improved to provide the necessary information for both effective central monitoring, as well as fostering local accountability and participation. This could include developing national minimum service delivery standards and publishing annual reports for LAOs against these standards. Requiring submissions of performance based indicators (for financial and service delivery) as a prerequisite for grant release can also be considered.