Vietnam: What is the public sector? Will public sector employees be eligible for salary increase from July 1, 2024 under Resolution 27?
What is the public sector in Vietnam?
The public sector is the sector that is used to distinguish it from the private sector (non-state sector). The state sector is an area of economic, social, and political activity in which the state decides. Meanwhile, the private sector is the operating sector decided by the private sector. However, the State influences the decisions of the private sector through the system of legal documents as well as the rules and regulations of the State in each period.
Another conception, or another way of defining the public sector, is based on the nature of ownership. The public sector is the area that brings together all that is owned by the state (or as many countries say owned by the whole people). This is also the most specific way of distinguishing the private sector and the public sector.
*Note: The above concept is referenced from the document used for graduate training in state management of the National Academy of Public Administration.
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Will public sector employees in Vietnam be eligible for salary increase from July 1, 2024 under Resolution 27?
On October 1, the National Assembly of Vietnam passed a resolution on the 2024 state budget estimate. Accordingly, from July 1, 2024, it will implement the overall salary policy reform by Resolution 27-NQ/TW in 2018 of the Seventh Meeting of the XII Central Committee.
Under Resolution 27-NQ/TW of 2018, the detailed salary reform roadmap in Vietnam according to Resolution 27/NQ-TW is specified as follows:
(1) From 2018 to 2020
a) For the public sector
- Continue to adjust the statutory pay rate according to the Resolution of the National Assembly, ensuring it is not lower than the consumer price index and consistent with the economic growth rate; do not add new types of allowances according to occupation.
- Complete the development and promulgation of a new salary regime according to the content of salary policy reform, associated with the roadmap for administrative reform and downsizing; innovate and reorganize the apparatus of the political system; renew public service providers according to the Central Resolution.
(2) From 2021 to 2025 and vision to 2030
a) For the public sector
- From 2021, apply a new unified salary regime for officials, public employees, and armed forces in the entire political system.
- In 2021, the lowest salary paid to officials and public employees is equal to the average region-based statutory minimum wage in the enterprise sector.
- Periodically raise salaries by the consumer price index, economic growth, and state budget capacity.
- By 2025, the lowest salary paid to officials and public employees will be higher than the average region-based statutory minimum wage in the enterprise sector.
- By 2030, the lowest salary paid to officials, and public employees will be equal to or higher than the lowest salary of the highest region of the enterprise sector.
Thus, under Resolution 27 of 2018, from July 1, 2024, the lowest salary paid to officials and public employees will be higher than the average region-based statutory minimum wage in the enterprise sector.
Besides, in the spirit of salary reform, salaries paid to officials and public employees shall not be lower than the currently paid salaries.
Thus, from July 1, 2024, public sector employees may be eligible for salary increase (except for those working in 36 units applying the specific salary policies).
What is the formulation of 05 job positions-based payrolls upon salary reform in 2024 in Vietnam?
Under Resolution 27-NQ/TW of 2018, it will formulate and promulgate a payroll system according to job positions, leading titles, and positions to replace the current payroll system; transfer the old salary to the new salary, ensuring that it is not lower than the currently paid salary, including:
- Formulate 01 position payroll applicable to officials, and public employees holding leading positions (elections and appointments) in the political system from the central to the commune level according to the following principles:
+ The salary of positions must reflect the hierarchy in the political system; a person holding a leading position shall be paid according to that position, if a person holds more than one position, he/she shall enjoy the salary applicable to the highest position salary; a person holding the same leading position shall enjoy the same position salary; the position salary of the superior leader must be higher than the position salary of the subordinate leader;
+ Prescribe a salary for each equivalent type of office; fail to classify ministries, branches, departments, committees, and their equivalents at the Central level when formulating the payroll of posts at the Central; do not distinguish between different salaries and positions for the same leading title according to the classification of local administrative units, but implemented by allowances.
+ The classification of equivalent leadership positions in the political system to design the position payroll shall be decided by the Politburo after reporting to the Central Committee of CPV.
- Formulate 01 professional payroll according to the rank of civil servants and professional titles of public employees generally applicable to officials and public employees who do not hold leading titles, each rank of civil servants and professional title of public employees with multi-salary grades, according to the principles:
+ At the same level of work complexity, the salary is the same;
+ In case of higher than normal working conditions and vocational incentives, job-based allowances shall be applied;
+ Rearrange the group of ranks and the number of grades in the ranks of civil servants and professional titles of public employees, and encourage officials and public employees to improve their professional qualifications.
The appointment to the rank of civil servant or professional title of public employee must be associated with the job position and structure of ranks of civil servants, and professional titles of public employees and implemented by agencies, organizations, and units managing officials and public employees.
- Formulate 03 payrolls for the armed forces, including:
+ 1 payroll for army officers, officers, and non-commissioned officers in police service (by position, title, and military rank or grade);
+ 1 payroll of technical military and police officers
+ 1 payroll of defense workers, and police workers (which keeps the salary correlation of the armed forces compared to administrative officials as at present).
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