Rethinking Thailand’s State Welfare Card: Addressing Targeting Flaws for Greater Impact

Since 2017, Thailand’s State Welfare Card (SWC) programme has been the government’s primary instrument for poverty alleviation. However, its effectiveness has been limited by poor targeting, leading to some deserving individuals being excluded from the programme while ineligible ones manage to receive benefits. Redesigning the programme by integrating the current self-targeting model with a community-based targeting approach would improve its efficiency. However, successive governments may not have had the incentive to reform the programme, given its populist appeal.

Since the late 1970s, Thailand’s labour-intensive, export-led growth has helped lift many out of poverty, but in the past decade, stagnating growth and political instability have exposed its limitations. Thus, extreme poverty persists. In 2023, Thailand’s National Economic and Social Development Council (NESDC) estimated that about 2.4 million people remained below the national poverty line of 3,043 baht (US$94) per month.

To address persistent poverty, in October 2017, the then government of General Prayut Chan-o-cha launched the SWC programme, Thailand’s largest-ever unconditional cash transfer initiative. Covering over 20 per cent of the population, the programme provides monthly cash allowances to unemployed individuals or those with annual incomes below 100,000 baht. Since the poverty rate measured by the national poverty line is 3.4 per cent, this means the ceiling for accessing SWC benefits is generous, resulting in far more SWC recipients than those officially below the national poverty line.

Although well-intentioned, the policy has consistently missed many of those below the poverty line. In 2018, fewer than 15 per cent of the beneficiaries were actually below the national poverty line, while only one-third of those below the national poverty line received welfare payments, leaving about 2 million individuals in poverty excluded. By 2023, the NESDC estimated that coverage had improved to include about 47.72 per cent of those below the poverty line. In addition, 93.88 per cent of SWC recipients had annual incomes above the poverty line, including about 2 per cent of the population’s richest, each earning on average 440,472 baht annually. Yet, nearly one million people experiencing poverty remained unreached.

These anomalies stem from flaws in both eligibility criteria and targeting mechanisms. While adjusting the eligibility criteria can reduce the number of beneficiaries above the poverty line, it does not guarantee better coverage of those below the poverty line, which is the primary aim of the SWC programme and, therefore, requires priority attention through improved targeting mechanisms.

Ensuring that social assistance reaches the intended recipients is fundamentally challenging, especially in a country with a large informal economy where reliable income data is scarce. Thailand’s SWC programme currently uses a self-targeting approach, requiring households to apply for benefits themselves. While research shows that this method can reach more low-income individuals than some alternatives, it also creates incentives for ineligible individuals to apply for benefits. Moreover, self-targeting places a burden on low-income households to prove their eligibility by providing documentation such as statements of income, land ownership, and financial assets. If the time and effort required to gather such evidence outweigh the expected benefits, eligible individuals may decide not to apply, leaving them trapped in poverty.

The programme has increasingly been viewed as a populist tool, shaped more by electoral considerations than by sound economic rationale.

To enhance the efficiency of the self-targeting approach, the government may need to initiate verification programmes that involve interviews of applicants at registration sites or home visits. Local governments can play a crucial role in this screening process by verifying eligibility, managing enrolment, and monitoring programme implementation. With 13.5 million SWC recipients spread across 7,255 Tambon (sub-districts), each Subdistrict Administrative Organisation would, on average, be responsible for about 2,000 cardholders. To enable local authorities to undertake the screening process effectively, the central government would first need to conduct a study to determine the level of funding and personnel support these authorities would require for the task.

If relying solely on local administrative capacity proves impractical, an alternative is to adopt or combine the self-targeting method with community-based targeting. As economist Ben Olken notes, community-based targeting empowers communities to apply their local understanding of poverty in determining not only who should receive assistance but also how much support each household should get, acknowledging varying levels of poverty. Examples include Indonesia’s Covid transfers and the Bangladesh Food-for-Education programme. In Thailand, village councils and community committees could take on this targeting role.

However, the community-based approach risks corruption or favouritism, particularly through patronage networks. To ensure fairness and transparency, the entire process should be subject to oversight by independent third parties or higher-level government authorities.

Given the substantial evidence of the programme’s poverty-reducing impact — as well as its positive spillover effects on families, including educational outcomes and the long-term reduction of intergenerational poverty — the Thai government could pilot a hybrid model of self-targeting supplemented by community validation in rural provinces. Such a pilot would enable the government to determine the feasibility and national scalability of this approach.

That said, any meaningful revision of such a large-scale social assistance scheme demands strong political commitment. This is particularly challenging given that the programme currently benefits over 15 million people, all voters. Reforming the programme could mean some beneficiaries will no longer receive benefits. Several political parties campaigned during the 2023 Thai general election on promises of increasing the quantum of welfare, and they could be sensitive about reforming the SWC programme. In short, the programme has increasingly been viewed as a populist tool, shaped more by electoral considerations than by sound economic rationale.

Politics aside, it bears recognising that improving the efficacy of the SWC will not only help Thailand get back on track in poverty reduction; it will also curb unnecessary monthly cash transfers to ineligible individuals as well as the opportunity costs in terms of the funds that could have supported other urgent programmes, such as measures to ease the economic impact of US President Donald Trump’s tariffs.

2025/225