In 1991 (B.E. 2534), following the cabinet’s resolution, the Ministry of Finance, in an effort to reform the then-existing pension scheme for government officials, introduced the central provident fund system. This led to the establishment of the Government Pension Fund under the Government Pension Fund Act B.E. 2539 (AD 1996). Membership is voluntary for officials who entered the government service before the Government Pension Fund Act came into effect on 27 March 1997. For those joining the official service after that date, membership of the fund is mandatory.
Upon leaving government service or entering retirement, GPF members are entitled to two portions of payment. The first is gratuity or pension from the state agencies for which they have served. The second is a lump sum from the GPF, which is made up of member’s personal savings and the government’s additional fund and compensation as well as other benefits from the investments managed by the GPF.
The GPF, established under the Government Pension Fund Act B.E. 2539 (AD 1996), is neither a government agency nor a state-owned enterprise under the law on budgeting. The revenues of the Fund, therefore, are not required to be remitted as the state revenues. The Finance Minister, who takes charge of the GPF Act, performs the functions of governance and supervision of the Fund’s administration, with the Office of the Auditor-General of Thailand acting as the auditor.
The money of the Fund is comprised of the following:
The government shall allot an annual expenditure budget in the amount not less than 20 percent of the annual expenditure budget for officials’ gratuity and pension to a reserves account annually until the reserves, general fund and the accruements thereof reach 3 times of the annual expenditure budget for officials’ gratuity and pension. Thereafter, an annual expenditure budget shall be set up to maintain the reserves, general fund and the accruements thereof at the level of 3 times of the expenditure budget for officials’ gratuity and pension in each year. If the reserves, general fund and the accruements thereof are above 3 times of the annual expenditure budget for officials’ gratuity and pension, then such excess money shall be remitted as the state revenues.