Thailand : Milk scandal grows into corruption probe
Milk scandal grows into corruption probe
By: King-Oua Laohong, Bamrung Amnatcharoenrit and Sirikul Bunnag
21/02/2009
An anti-graft agency is gearing up for a nationwide investigation into school milk supplies after its probe into the scandal in Chumphon uncovered possible price collusion in the scheme.
The secretary-general of the Office of the Public Sector Anti-Corruption Commission (PACC), Tharit Pengdit, said the inquiry into the selection of milk suppliers in Chumphon has suggested irregularities in the bidding process.
Of 18 eligible suppliers, only two tendered bids. One of them quoted an unusually high price while the other offered the median price and won the contract to supply the milk.
Moreover, the two suppliers are apparently owned by the same individuals, said Mr Tharit.
"Price collusion is suspected in this case. So the PACC is prepared to launch an investigation into the bidding process for the school milk scheme across the country. We will choose [schools for the probe] at random. The findings should give us the big picture," he said.
The school milk scandal emerged when the director of Pak Lek school in Chumphon's Phato district complained that milk distributed to his students under the scheme was below standard.
His suspicions were confirmed by the Food and Drug Administration (FDA), which ran lab tests on the milk samples and found the fat level was only 2.6 per cent, below the FDA standard of 3.2 per cent.
These findings have triggered speculation about corruption in the school milk project which is run by local administrative organisations.
The local bodies are required to buy pasteurised milk from eligible suppliers in zones selected by the National Dairy Committee and the Interior Ministry's Provincial Administration Department.
Mr Tharit said a requirement for the local organisations to buy milk only from within their zones is deemed to have opened up channels for price collusion among the suppliers.
Deputy Interior Minister Boonjong Wongtrairat said yesterday he welcomed changes, if any, to the bidding rules to spur competition among milk suppliers.
He urged the local administrative bodies to submit a proposal to the National Dairy Committee.
He said the ministry would monitor the scheme closely and take action against state officials found involved in irregularities.
Meanwhile, the Dairy Farming Promotion Organisation of Thailand (DPO), which produces the Thai-Danish milk brand, yesterday called on the government to seek ways to relieve its excess inventory of UHT milk worth 200 million baht for the school milk scheme.
"If we can't solve this problem, we may face losses this year," said Sunun Keeratiwattanapisarn, a director of the DPO board.
The DPO, a government-controlled organisation, acts as a buyer of excess supplies of raw milk from farmers as part of a relief plan. But it can help buy only 40 per cent of the oversupply, which is expected at 280 tonnes a day. Some statistics show the oversupply of raw milk can reach 400 tonnes a day.
Amnaj Theeravanich, the board chairman, said the oversupply is exacerbated by imports of milk powder whose price is cheaper than raw milk. Manufacturers prefer milk powder for commercial production. The problem also stemmed from cold weather in the past months which made cows produce more milk.
He said the DPO also has to shoulder the financial burden from the purchase of excess supplies for the school milk programme. It needs to borrow 185 million baht from the Farmers Aid Fund for the milk purchases.
"It is hard for us to run our operations these days. We act as a government agency to buy excess milk supplies from the farmers but at the same time we have to strengthen our brand and marketing strategy," Mr Amnaj said.
In a related development, Chantana Ungchusak, manager of a campaign to reduce sugar intake among children, yesterday urged the government not to change from unsweetened milk to flavoured milk.
Her call came amid suggestions that schools buy flavoured milk for children who had turned away from fresh milk due to the substandard product scandal.
"The problem is not that the children do not enjoy the milk. It is with the manufacturers who produce substandard milk. That's why the children do not drink it," she said.
bangkokpost.com
Quote:
Of 18 eligible suppliers, only two tendered bids. One of them quoted an unusually high price while the other offered the median price and won the contract to supply the milk.
Moreover, the two suppliers are apparently owned by the same individuals, said Mr Tharit.
:rofl: it never ends
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