Abolition of Non-Salary Allowances for Officials and Public Employees from July 1, 2024, in the Implementation of Salary Reform
Abolishment of Non-salary Allocations from July 1, 2024, for Officials and Public Employees According to Resolution 27?
“This is a reform, not just a regular salary increase. If there are no changes, the time we can apply this is from July 1, 2024.” At the closing session of the Vietnam Socio-Economic Forum 2023 held in Hanoi on September 19, 2023, National Assembly Chairman Vuong Dinh Hue emphasized the expeditious implementation of a fundamental reform of the salary policy in 2024.
In Resolution 27-NQ/TW 2018, it is required to decisively implement financial and budgetary solutions, viewing this as a breakthrough task to generate resources for the salary policy reform, as follows:
- Implement decisively and effectively the Central Committee's resolutions on restructuring the economy associated with renewing the growth model; on completing the socialist-oriented market economic institution; on developing the private economy; on renewing, enhancing the efficiency of state-owned enterprises; on restructuring the state budget, managing public debt to develop sustainable revenue sources, and enhancing the central budget's leading role.
- Deploy tasks to restructure state budget revenues, ensuring the total revenue source and sustainable revenue structure. Amend, supplement, and complete tax policies in the direction of expanding the tax base and encompassing new revenue sources. Strengthen revenue management and make fundamental changes in combating revenue losses, addressing and preventing smuggling, commercial fraud, producing and trading counterfeit goods, transfer pricing, and tax evasion. Practice saving, and fight against corruption and waste in using the state budget and in basic construction investment. Decisively recover assets in corruption and economic cases.
- Annually allocate approximately 50% of the increased forecast revenue and 70% of the realized increased local budget revenue, and about 40% of the central budget revenue increase for the salary policy reform.
- Enhance management, and improve the efficiency of state budget expenditures; continue to implement a 10% saving on yearly incremental regular expenditure until the wage fund based on authorized staffing is allocated.
- The remaining funds for salary policy reform after ensuring annual statutory pay rate adjustments and ensuring social security policies issued by the Central Government (for local budgets), investment projects according to regulations (for localities with regulatory adjustments) must continue to be used for salary policy reform post-2020, not for other purposes without authorized permission.
- Abolish non-salary allowances for officials and public employees sourced from the state budget such as: meeting allowances; allowances for drafting legal documents and proposals; conference allowances... Implement a fixed wage fund linked with the objective of downsizing the workforce for agencies and units. Expand the mechanism of fixed funding linked to results of task performance. Detach the wage level of officials and public employees from the drafting, amending, and supplementing of policy regulations that are wage-neutral. Study to regulate fixed non-wage benefits (cars, telephones, etc.). Only issue new policies when resources for implementation have been arranged and balanced.
- Accelerate the conversion from fees to service prices in public services, gradually calculating all costs accurately for basic and essential services, while connecting it with appropriate support policies for the poor and policy beneficiaries. For public services pricing not using the state budget, autonomy is granted to service-providing units to decide independently, ensuring cost recovery and generating surplus.
Self-financing public service units must ensure funding for salary policy reform implementation. For public service providers covering partial regular expenses, continue to use at least 40% of retained revenue according to policies (specifically, the Health sector uses at least 35% after deducting costs included in service prices), save 10% of yearly incremental regular expenditure sources, and arrange budgets allocated by the state to fund the salary policy reform.
Public service units with no revenue, fully funded by the state budget for recurrent expenses, must save 10% of yearly incremental regular expenditure sources and arrange from budget allocations to implement salary policy reform.
When salary reform under Resolution 27-NQ/TW 2018 is implemented from July 1, 2024, non-salary allowances for officials and public employees sourced from the state budget will be abolished.
Abolishment of Non-salary Allocations from July 1, 2024, for Officials and Public Employees upon Implementing Salary Reform
When is the Reporting Time for Salary Reform Roadmap and Plans?
In clause a, sub-item 15, Section I of Resolution 144/NQ-CP 2023, the Ministry of Home Affairs is mentioned with responsibility regarding the salary reform as follows:
On the socio-economic situation in August and the first 8 months of 2023
...
- The Ministry of Home Affairs to preside over, in cooperation with relevant agencies and localities:
a) To preside over, in cooperation with relevant agencies, to take into account the Politburo's feedback to finalize the draft report to be submitted to the National Assembly on the roadmap and plans for salary policy reform, report to the Government of Vietnam, Prime Minister of the Government of Vietnam before September 16, 2023.
September 16 was the deadline for the Ministry of Home Affairs to report on the roadmap and plans for salary reform.
What is the Specific Roadmap for Salary Reform from 2021 to 2025?
In Resolution 27-NQ/TW 2018, specific goals for salary reform from 2021 to 2025, and vision to 2030, are proposed as follows:
* For the public sector
- From 2021, implement a new unified salary policy for officials and public employees, and armed forces across the entire political system.
- In 2021, the minimum salary of officials and public employees will be equal to the average minimum salary of different regions in the business sector.
- Periodically adjust salary levels in line with consumer price index, economic growth rate, and the state budget's capacity.
- By 2025, the minimum salary of officials and public employees should be higher than the average minimum salary of different regions in the business sector.
- By 2030, the minimum salary of officials and public employees should be equal to or higher than the minimum salary of the highest region in the business sector.
* For the business sector
- From 2021, the state will periodically adjust regional minimum wage levels based on recommendations from the National Wage Council. Enterprises can implement salary policies based on negotiations and agreements between employers and employees, including collective employee representatives; the state will not directly intervene in enterprise salary policies.
- Manage labor and wages in state-owned enterprises through wage cost contracting linked to business tasks until 2025, progressing to task-based contracting by 2030.
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