[Getty Images]
[Getty Images]

Thailand's government is introducing an early retirement program for civil servants to reduce public spending, with a target of cutting the civil service workforce by about 5 percent each year.

Deputy Prime Minister Phakorn Nilprapunt said the program is set to take effect from fiscal year 2027, which begins in October 2026, according to Bloomberg and other foreign media Sunday (local time). Civil servants aged 50 and older will be eligible first, while those aged 40 and older may apply if they have poor health or caregiving responsibilities.

The first phase is estimated to cost about 7 billion baht ($209 million). Thailand had up to 1.68 million civil servants as of June 2023.

The government is considering a severance package exceeding 12 months' salary, with the exact amount still being worked out with the Finance Ministry. The relevant ministries plan to finalize the details and submit the proposal to the cabinet for approval.

Prime Minister Anutin Charnvirakul's government has made fiscal consolidation a priority. Relatively high spending has strained the budget, and public debt is approaching the government's self-imposed ceiling of 70 percent of GDP. The early retirement scheme is part of a broader effort to build a financial buffer against potential economic shocks.

Under a medium-term fiscal plan the cabinet approved in November 2025, public debt is projected to reach 68.17 percent of GDP in fiscal year 2026 and 69.36 percent in fiscal year 2027 — both close to the ceiling. The fiscal year 2027 budget stands at about 3.79 trillion baht, including roughly 850 billion baht in personnel costs, about 390 billion baht in pension payments and around 100 billion baht in medical benefits. Thailand's total public-sector workforce numbers about 3 million, of whom about 1.75 million are permanent civil servants.

The early retirement initiative is one pillar of the government's broader bureaucratic reform agenda. The government has pledged to eliminate one-third of civil service positions and is also pursuing agency consolidation, digitalization and AI adoption to reduce workloads. Last month, the early retirement proposal received approval in principle at a meeting on civil service workforce planning. The scheme under discussion would cover those aged 50 or older with at least 25 years of service, as well as those aged 40 to 49 with at least 10 years of service. Each participant's departure would result in the permanent elimination of one position, and those who receive severance would be barred from returning to public service.

However, concerns have been raised. Nonarit Bisonyabut of the Thailand Development Research Institute said that without first reducing the scope of government work, the program risks driving out capable staff while leaving vacancies to be filled by contract workers. Some have also called for exemptions in sectors already facing staff shortages, such as hospitals.


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