Planning and budget allocation systems for rural development are not formulated to meet the real needs of villagers who stand to lose more than they gain, The Nation reports in the fifth part of the series on Rural Thailand.

In 1995, a woman officer in full uniform from the Office of Community Development in Surin province arrived at Koh Talung village with a budget of over Bt400,000 to convince villagers to set up a modern convenience store.

Today they have a beautiful Community Development Mart, which has won an award for best community store but its customers, who were supposed to benefit from the store, are now in debt to it for Bt200,000.

Actually, we wanted neither the store nor the award, storekeeper Phattana Patvichai recalled. We really wanted a rice mill, but the officer said the budget we were to receive was only for setting up the store and we could not use it for other purposes. She convinced us that we might have a rice mill later if the store made a lot of profit.

Over the past decade the government has poured more than Bt500 billion into rural development schemes through six ministries (Commerce, Education, Public Health, Interior, Agriculture and Industry), but under inefficient budget allocation this huge amount of money has not contributed as much to the betterment of rural people's life as other projects had in preceding decades.

Even detractors of rural development efforts have to concede, however, that the government's achievements are numerous, particularly in public health, family planning, road building and irrigation.

But the government's tendency to stick to its old approaches in investment on rural development projects has in recent years yielded diminishing returns.

Besides corruption in the system, the process of budget allocation from planning to evaluation has been handled by government agencies to serve their own policies than rural people's needs.

The Interior Ministry's Community Development Department proposed its community store projects without consultation with or the participation of villagers who have to live with the consequences.

Based on the principle of economies of scale, the department hoped to buy in bulk, supplying these rural community stores, which would help people buy goods at fair prices and raise funds for other businesses.

The Budget Bureau, which has allocated about Bt70 million annually to the department for this plan, did not establish an effective evaluation system to check if the outcome helped people improve their quality of life.

So far, some 2,687 community stores have been set up in rural villages nationwide, but a lot of these stores are in trouble, and some are going to be closed down, like the Community Development Mart at Koh Talung village.

Phattana from Koh Talung explained that the officer from the department was interested only in a setting up a store to meet agency standards in store design, sales targets and accounting.

She encouraged us to put new kinds of products on the shelves. So we did. And to meet the sales target, we have been selling on credit. Finally we became the best community store because we met all the standards.

But now we are losing business because we cannot collect Bt200,000 from our customers, Phattana said.

Another Koh Talung villager said that the officer had other interests in coming to the village because, he said, she moonlighted as a representative of a life insurance company.

Besides the promotion her boss gave her because our store met the standards, she also made money from her sideline business, he said.

Government agencies, according to the Thailand Development Research Institute (TDRI), prefer to evaluate their projects by materials and numbers rather than qualitatively. Officers are concerned more with producing reports with statistics and performance records than listening to feedback from villagers.

The Budget Bureau monitors budget spending by checking each item in the checklist of the projects submitted the previous year. It does not check whether the item is fully functional, nor does it get involved in evaluating how local people are affected by the project.

Apart from the convenience stores, many infrastructure projects have been implemented under the same system of budget allocation and evaluation. Buildings and activities in rural provinces have seldom stemmed from the real demand of local people.

Provincial central markets were constructed by the Agriculture and Commerce ministries, which felt that a central market should become a business centre. But after construction, many central markets became children's playgrounds.

Wassana Assaranurak, manager of Chaophaya Tharua Khamnunsong Co, the central rice market in Nakhon Sawan, said the central market in her province was built without surveying farmers to find out if they needed one. The government spent a lot of money building a big cement field and store houses, which have never been used, she said.

Similar problems also apply to the construction of community health centres. Since 1993, the Public Health Ministry has spent more than Bt50 billion on 1,600 modern new health centres. The ministry also plans to equip the new stations with permanent staff after completing about 2,000 stations in 2001. But villagers doubt if they will benefit from the investment.

Yee Ubonwattra, 70, who lives in Lop Buri's Nong-tao village, said the new centre offers nothing new.

I don't want to go to the health centre anymore because the doctor there never pays attention to us. He plays cards and returns home early. If I were his boss, I would not pay him because I would assume that he could earn money from the gambling, he said.

Research by the National Economic and Social Development Board in 1997 concluded that rural development projects in Thailand during the past decade had created problems for villagers throughout the country.

Primary schools have been built in almost every village in Thailand, but they have not helped children develop the ability to solve problems.

During the past decade of rural development, villagers seem to have received higher incomes from a variety of sources outside the agriculture sector. But in terms of income distribution, the average income of rural people in 1996 was 16 per cent lower than the average income of urban people, compared to 10 per cent lower in 1990.

The CD Mart at Koh Talung village will shut down soon because it cannot collect the money the villagers owe. Also gone will be the villagers' dream of having their own rice mill to process their paddy in the next harvest season.