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Teachers push back in Thai govt loan dispute

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Teachers push back in govt loan dispute

By THE NATION

 

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Educators deny avoiding debt payment, say they are being overcharged.

 

TEACHERS ARE rejecting accusations that they are trying to avoid repaying their debts as has been suggested by some senior officials and critics of their campaign. 

 

The group of about 100 teachers retorted that the woes from being deeply in debt had driven them to launch the campaign demanding the government intervene in their case. They say unreasonable terms for their loans under the Funeral Service Welfare Fund for Teachers and Education Personnel’s loan scheme are preventing them from quickly paying back what they owe. 

 

“People should study the details before making such accusations,” said Teaching Professional Network of Thailand president Auychai Watha. “Teachers are not avoiding repaying the loans, but we want the government to plan measures to sort the issue of some 500,0000 teachers facing overwhelming debts.

 

“Many of us didn’t get justice or fair treatment from the ‘helping teacher friends’ loan scheme organised by the welfare fund and the Government Savings Bank (GSB) because the interest rate charged to us was incorrect,” Auychai said.

 

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Auychai said he still owes Bt1.1 million after paying a monthly instalment of over Bt7,000 for the past seven years to repay the Bt1.2 million he borrowed. 

 

The teacher leader said the group just wanted the government’s help to solve problems, just as they had helped farmers with a moratorium on debt repayments and a debt restructuring scheme. The teachers are also calling for the authorities to probe whether the GSB bank had taken advantages of the loan scheme participants, he said.

 

The 100-strong group had on Saturday urged 450,000 others to join them and stop repaying the debts to the scheme starting on August 1 in order to pressure the government and GSB to approve a six-month moratorium on debt repayments. They also called for the annual interest rate to drop to 1 per cent (from the current 5 and 7 per cent rates). The teachers also demanded that the National Legislative Assembly and the government set up a special committee to find solutions for the teachers’ overwhelming debts. 

 

However, GSB president and CEO Chatchai Payuhanaveechai said no additional assistance measures would be implemented for the teacher debtors. 

 

He said the bank had already launched multiple measures to help, including debt restructuring, a three-year moratorium on the capital loan amount and a low-interest loan for refinancing old debt. 

 

GSB in May had signed a Memorandum of Understanding (MoU) with the welfare fund to allow the debt restructuring with a one per cent reduction in loan interest. 

 

Under the MoU, debtors would continue to pay 5 per cent interest per year, with 4 per cent going to service debt and 1 per cent paying down the capital loan. On a debt of Bt1 million, the 1 per cent allocation would be Bt10,000. The debtor would be given a choice to either use that Bt10,0000 (or Bt833 per month) to repay the outstanding capital and so shrink it quicker, or could lower their monthly instalment (which includes payment for interest and capital) by up to Bt833 per month.

 

Despite the MoU, there remained the issue of both agencies needing to soon find a mutually satisfactory conclusion to deductions to the welfare fund’s capital. The capital fund had been depleted to repay the debts on behalf of teachers who had failed to make repayments for more than three consecutive months. 

 

GSB currently has 433,000 teacher debtors owing about Bt406 billion. 

 

In the first phase, the welfare fund organised with Krungthai Bank had covered about 50,000 teachers who borrowed a total of Bt12.9 billion.

 

Meanwhile, the Justice Ministry’s deputy permanent secretary, Thawatchai Thaikhiew, warned the teachers’ group that a grim outcome could result if they ceased to repay their debts, especially for those owing more than Bt1 million.

 

Thawatchai said they could be forced into bankruptcy for three years and drag their loan guarantors into bankruptcy too. If declared bankrupt, teachers would be disqualified for positions in the civil service as per the Government Teacher and Education Personnel Act 2004, he said. 

 

Source: http://www.nationmultimedia.com/detail/national/30350272

 
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-- © Copyright The Nation 2018-07-18

 

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57 minutes ago, webfact said:

Thawatchai said they could be forced into bankruptcy for three years and drag their loan guarantors into bankruptcy too. If declared bankrupt, teachers would be disqualified for positions in the civil service as per the Government Teacher and Education Personnel Act 2004, he said.

 

So are the government prepared to lose 450,000 teachers ??

I would say the teachers are in quite a good position to negotiate.

Not that I agree with them, you take out a loan, you pay it back at the rate you signed up for.

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433,000 teachers in a country of 70 million sounds like an awful lot to me (obviously some will be retired etc). But Thailand's state school classrooms many times have 40 plus students and sometimes even 60 in the classroom.

 

Something seriously amiss here, and am not only talking about the idiotic so called teachers who have been borrowing and living well beyond their means, and their means to pay the cash back.

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I've no sympathy. 

 

Most, not all, do a bad job. Students are not provided with the proper education, equipment or  taught disipline plus respect. Setting an example is a far cry.

 

If teachers are supposedly struggling, then what about all the other work forces in other parts of industry?

 

I used to be employed at many different schools within Thailand and witnessed it all!!! 

 

Cry wolf comes to mind...

 

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2 hours ago, webfact said:

They also called for the annual interest rate to drop to 1 per cent (from the current 5 and 7 per cent rates).

Lower the rate they’ll just borrow more.

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1 hour ago, cornishcarlos said:

 

So are the government prepared to lose 450,000 teachers ??

I would say the teachers are in quite a good position to negotiate.

Not that I agree with them, you take out a loan, you pay it back at the rate you signed up for.

They might be prepared to lose these 100 teachers so the other 449,900 know they better repay their debts.

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2 hours ago, webfact said:

Auychai said he still owes Bt1.1 million after paying a monthly instalment of over Bt7,000 for the past seven years to repay the Bt1.2 million he borrowed. 

1,200,000-588,000=612,000. Get better rates off the mafia money lenders.?

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Young thais need to learn not to live beyond their means and get stuck in debts. Their teacher going bankrupt and loose their job might be most important thing the teacher will ever teach the children????

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58 minutes ago, dinsdale said:

1,200,000-588,000=612,000. Get better rates off the mafia money lenders.?

Care to retract that remark and do some calculations.. i though foreigners could calculate things well.

 

Here at 6% you see after 7 years he own about 1.1 million  (ok i should have calculated i per month but I am lazy but it would not change much)   Dont you hate facts ?  He should have paid more then 7000.. its just too low.

 

 

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4 hours ago, webfact said:

debtors would continue to pay 5 per cent interest per year, with 4 per cent going to service debt and 1 per cent paying down the capital loan. On a debt of Bt1 million, the 1 per cent allocation would be Bt10,000.

debt free in 100 years. Or did I miss something?

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1 hour ago, robblok said:

Care to retract that remark and do some calculations.. i though foreigners could calculate things well.

 

Here at 6% you see after 7 years he own about 1.1 million  (ok i should have calculated i per month but I am lazy but it would not change much)   Dont you hate facts ?  He should have paid more then 7000.. its just too low.

 

 

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How does your model compare to the terms of the MOU?

5 hours ago, webfact said:

Under the MoU, debtors would continue to pay 5 per cent interest per year, with 4 per cent going to service debt and 1 per cent paying down the capital loan. On a debt of Bt1 million, the 1 per cent allocation would be Bt10,000.

The 5% interest rate appears not to be solely for pay down of debt service interest. The "1 per cent paying down the capital loan" (aka "principle"?) seems to place a limit to payoff of capital. So it's confusing to me that the traditional loan model applies. 

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6 hours ago, webfact said:

Auychai said he still owes Bt1.1 million after paying a monthly instalment of over Bt7,000 for the past seven years to repay the Bt1.2 million he borrowed.

None were taught maths on purpose

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6 hours ago, webfact said:

500,0000 teachers facing overwhelming debts.

half a  million stupid  people

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5 minutes ago, Srikcir said:

How does your model compare to the terms of the MOU?

The 5% interest rate appears not to be solely for pay down of debt service interest. The "1 per cent paying down the capital loan" (aka "principle"?) seems to place a limit to payoff of capital. So it's confusing to me that the traditional loan model applies. 

In the other newspaper i read that teachers pay between 5 and 7 % so i took 6%. He started his loan 7 years ago.. a year before that time I had a loan too for about 6% in Thailand so the percentage does not seem to be that much off. 

 

I did not say this model was perfect (i set it up in 5 minutes). But it gives a good indication about the interest percentage. Does not seem to be that much higher then normal. It just looks bad because you always pay a lot of interest at the start of a loan especially if you only pay a small amount monthly.

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