Slow disbursement of public funds has been a persistent issue for many years, for which a lack of preparation from the investment procedures to site clearance has been one of the main issues.

Deputy Prime Minister Le Minh Khai at the discussion. Source: quochoi.vn

Deputy Prime Minister Le Minh Khai gave the remarks at a discussion session held by the Standing Committee of the National Assembly (NA) on public investment in the 2021-2025 period today [January 19].

Last year, Vietnam’s disbursed amount of public funds stood at 77.3% of the year’s estimate, 6% lower than that of the same period last year. Upon breaking down, the disbursement of domestic funds reached 84% of the plan, and that of foreign sources hit just 26.77%.

Statistics from the Ministry of Finance (MoF) revealed only 20 out of 63 provinces/cities and seven ministries have spent over 80% of their budget allocations, while 30 from the total 50 ministries/ministerial level-agencies and 16 provinces/cities recorded the figure below 65%.

For 2022 and the subsequent years, Khai said the Government is committed to ensuring flexible management of both mid-term public investment funds and the economic recovery program.

“Each project under the mid-term public investment plan and the recovery program would be reported to the Standing Committee for greater efficiency in disbursement,” Khai noted.

On this issue, Deputy Auditor General Nguyen Tuan Anh urged the Government to take drastic action to improve the disbursement rate, including a clear deadline for completion with severe penalties for those failing to meet it.

NA Chairman Vuong Dinh Hue noted a key factor for efficient state budget allocation is thorough preparation in the pre-investment process.

A Government report suggested it plans to allocate VND824.7 trillion ($36.3 billion) in mid-term public investment plan 2021-2025 for ministries, ministerial-level agencies, and localities.

So far, nearly VND640 trillion ($28.2 billion) is subject to the Standing Committee’s approval before being allocated for disbursement.

Vice Minister of Planning and Investment Tran Quoc Phuong said the ministry is prepared to speed up investment procedures for public projects to avoid possible delay, as well as take steps to supervise the implementation process.

As of December 27, 2021, Hanoi disbursed a total of VND25.38 trillion ($1.11 billion) of public funds, equivalent to 61% of the target set by Prime Minister Pham Minh Chinh.