Seminar: Commenting on the draft State Budget 2022 – The ability to meet social security goals
On November 5, 2021, the seminar “State Budget Estimation 2022 – The ability to meet the goal of Social Security” took place with the participation of representatives of the State Budget Department, Ministry of Finance, civil society organizations, professionals, media agencies and interested individuals. The seminar was co-organized by the Budget Transparency Alliance (BTAP) and chaired by the Center for Development and Integration (CDI) and the Vietnam Center for Economic and Strategic Studies (VESS).
Delegates attending the seminar discussed solutions to mobilizing and using the State Budget to achieve the goals of social security in 2022 as well as issues posed with welfare policies, in the coming time to support people and businesses affected by Covid-19.
Speaking at the forum, Mr. Nguyen Minh Tan, Deputy Director of the State Budget Department, Ministry of Finance said that the state budget revenue estimate in 2022 is built on the basis of an expected economic growth of 6-6.5%. compared to 2021, the average growth rate of the consumer price index (CPI) is about 4%; crude oil price 60 USD/barrel; export turnover growth is about 5.2%.
Regarding state budget revenue, the state budget revenue estimate in 2022 was more conservative when forecasting that total state budget revenue in 2022 would only increase by 3.4% compared to the estimated implementation in 2021. Main revenues are estimated with caution when revenue from land use decreased by 4% over the same period last year, revenue from import and export activities increased only 5.1% compared to the estimated implementation in 2021 and revenue from crude oil decreased. In case the expected state budget revenue does not increase revenue as planned or the spending demand increases, it is necessary to have scenarios and measures to handle.
Regarding state budget expenditure, the state budget expenditure estimate in 2022 has shown a trend of changing the spending structure in the direction that is suitable with the epidemic context, although it is still not really clear. Recurrent expenditures increased by 5.1% compared to the 2021 estimate with increased spending on some important and newly arising social security policies being necessary and reasonable. The cost estimate lacks detailed information on the issuance and implementation of social security policies to support people affected by Covid.
The State Budget Estimate Report in 2022 published on the website of the Ministry of Finance includes (i) Assessment of state budget implementation in 2021, (ii) Expected state budget estimate for the year 2022, (iii) 3-year state budget-financial plan, 2022-2023 and 2024, (iv) Appendix related data. However, experts and citizens still have difficulty connecting the 2022 budget target with the data annex.
Assoc.Prof.Dr. Vu Sy Cuong, Deputy Head of the Department of Financial Policy Analysis, Faculty of Public Finance – Academy of Finance, said: “The draft State budget 2022 is not detailed in terms of investment expenditures like recurrent expenditures, so it is difficult to assess whether The state budget has enough to ensure 20% for education, 2% for science and technology, 1% for the environment as required by current regulations. There should be consistency in the state budget estimates over the years, if there are any changes, they need to be fully explained. At the same time, it is necessary to have a closer analysis and assessment of state budget spending in 2022, especially spending to support businesses and people to overcome the pandemic.”
Dr. Nguyen Duc Thanh, Director of the Center for Economic and Strategic Studies (VESS), a member of the BTAP Alliance, commented: “In general, the draft State budget 2022 reflects the spirit of action sharing and mobilization. resources to cope with difficulties in the current pandemic. However, the budget needs to be more specific, more transparent in highlighting how the budget will be used, how it will be implemented, in order to target the most difficult people, specifically here I want to emphasize that migrant workers in urban areas are heavily affected by the epidemic, causing them to lose their jobs or stop working and return to their homeland. It is a paradox to note that the poorest provinces often concurrently with the most migrants, are the provinces that need to spend the most on supporting returning migrant workers. Therefore, it is necessary to allocate budget to the most disadvantaged provinces under a special mechanism, and closely monitor its compliance.”
Mr. Nguyen Quang Thuong, Acting Executive Director of the Center for Development and Integration (CDI), the coordinating organization of the BTAP Alliance, said that the Vietnamese Government has implemented many solutions to support workers suffering The impact of Covid through policies such as Resolution 68/NQ-CP, Resolution 116/NQ-CP… However, the highest level of support according to NQ 68/NQ-CP and NQ 116/NQ-CP is still low. than the regional minimum wage, not to mention the Government’s support is 1 time while each Covid outbreak lasts at least 2 months. In my opinion, the Vietnamese government can increase the level of cash support for people, thereby stimulating demand, contributing to the completion of the state budget target in 2022.
Sharing this opinion, Mr. Pham Minh Thu, Institute of Labor and Social Sciences (Ministry of Labour, Invalids and Social Affairs) said that the current support for people and workers is low, not meeting the minimum standard of living. and inadequate forecast of the impact of the COVID-19 pandemic on workers’ lives
The one-time support level for self-employed workers does not meet the minimum standard of living, and the level of support for workers with labor contracts in some cases is not equal to the minimum wage prescribed by the State. The regulation that “one person can only benefit once in a support policy” while the policy scope lasts until the end of 2021, shows that the impact of the COVID-19 epidemic on the lives of people and people has not been fully forecast yet. labor, MSc. Pham Minh Thu said.
In order to achieve social security goals in the coming time, Ms. Nguyen Thu Huong, Senior Manager of Good Governance Program, Oxfam Organization in Vietnam, said that Vietnam should stipulate a minimum budget allocation. for social security (maybe from 6-10% of GDP) and increase spending from the state budget on voluntary social insurance policies, so that self-employed workers have full benefits similar to insurance compulsory society.
Besides supporting policies, some experts believe that people are in need of cash subsidy programs. Ths. Pham Minh Thu proposed, it is necessary to strengthen the cash subsidy program with a large enough budget, implement it as soon as possible and approach in a universal way such as households with children, households with the elderly, people with disabilities… The level of cash support must reach the “minimum standard of living” and the period of cash support corresponds to the period of isolation and community distancing. Expenditure on social security should be considered as an expenditure for development investment, or included in the policy more often than using the Contingency Fund.