What is the guidance for calculating pension and allowances from July 1, 2023 under Circular 06/2023/TT-BLDTBXH? What is the pension increase rate in Vietnam?

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What is the guidance for calculating pension and allowances from July 1, 2023 under Circular 06/2023/TT-BLDTBXH? What is the pension increase rate in Vietnam?

On June 29, 2023, the Ministry of Labor, War Invalids, and Social Affairs issued Circular 06/2023/TT-BLDTBXH on guidelines on adjustments to pensions, social insurance allowances, and monthly benefits.

The calculation of pension and allowances from July 1, 2023 will be carried out as follows:

(1) From July 1, 2023, pensions, social insurance allowances, and monthly benefits of regulated entities are adjusted as follows:

- Increased by 12,5% compared to the amount of June 2023 adjusted by Decree 108/2021/ND-CP dated December 7, 2021 of the Government of Vietnam. Specifically:

- Increased by 20,8% compared to the amount of June 2023 that was not adjusted in Decree 108/2021/ND-CP dated December 7, 2021 of the Government of Vietnam. Specifically:

(2) From July 1, 2023, pensions, social insurance allowances, and monthly benefits for regulated entities other than those in (1) after adjustments are as follows:

- For persons who receive pensions, social insurance allowances, and monthly benefits below 2.700.000 VND per month:

- For persons who receive pensions, social insurance allowances, and monthly benefits from 2.700.000 VND per month to below 3.000.000 VND per month: 

What is the guidance for calculating pension and allowances from July 1, 2023 under Circular 06/2023/TT-BLDTBXH? What is the pension increase rate in Vietnam?

Who is entitled to an increase of 20.8% in pension in Vietnam?

Under Decree 42/2023/ND-CP on adjustments to retirement pensions, social insurance allowances and monthly benefits issued by the Government of Vietnam on June 29, 2023;

The persons eligible for an increase of 20.8% in pension are determined according to clause 1, Article 2 of Decree 42/2023/ND-CP as follows:

Time and rate of adjustment

1. From July 01, 2023:

a) Pensions, social insurance allowances and monthly benefits payable to the persons prescribed in clause 1 Article 1 of this Decree are increased by 12.5% compared to the amount of June 2023 adjusted under the Decree No. 108/2021/ND-CP dated December 07, 2021.

b) Pensions, social insurance allowances and monthly benefits payable to the persons prescribed in clause 1 Article 1 of this Decree are increased by 20.8% compared to the amount of June 2023 not adjusted under the Decree No. 108/2021/ND-CP dated December 07, 2021.

Under clause 1, Article 1 of Decree 42/2023/ND-CP, the persons eligible for increased pensions and allowances include:

- Officials, public employees and workers (including those contributing social insurance voluntarily and retired people transferred from Social Insurance Fund of farmers of Nghe An province as prescribed in the Prime Minister’s Decision No. 41/2009/QD-TTg dated March 16, 2009); military personnel, police officers and cipher officers who are receiving monthly retirement pensions.

- Cadres of communes, wards and commune-level towns (hereinafter referred to as “communes”) prescribed in Government's Decree No. 92/2009/ND-CP dated October 22, 2009, Government's Decree No. 121/2003/ND-CP dated October 21, 2003 and Government's Decree No. 09/1998/ND-CP dated January 23, 1998 who are receiving monthly retirement pensions and benefits.

- Those who are receiving monthly work-capacity loss allowance as per the law; those who are on monthly benefits as prescribed in Decision No. 91/2000/QD-TTg dated August 04, 2000 and Decision No. 613/QD-TTg dated May 06, 2010 of the Prime Minister; workers in the rubber-manufacturing industry on monthly benefits as prescribed in the Decision No. 206-CP dated May 30, 1979 of the Government Council.

- Cadres of communes who are on monthly benefits as prescribed in Decision No. 130/CP dated June 20, 1975 of Government Council and Decision No. 111-HDBT dated October 13, 1981 of Council of Ministers.

- Military personnel who is on monthly benefits as prescribed in Decision No. 142/2018/QD-TTg dated October 27, 2008 (amended by the Prime Minister’s Decision No. 38/2010/QD-TTg dated May 06, 2010).

- Police officers who are receiving monthly benefits as prescribed in the Prime Minister’s Decision No. 53/2010/QD-TTg dated August 20, 2010.

- Military personnel, police officers and cipher officers who are receiving the same salaries as the military personnel and police officers on monthly benefits as prescribed in the Prime Minister’s Decision No. 62/2011/QD-TTg dated November 09, 2011.

- Persons who are receiving monthly occupational accident and disease allowances.

- People who have been receiving monthly death benefits before January 01, 1995.

Among these, the condition for persons entitled to a increase of 20.8% in pension is that they have not yet received a pension increase according to Decree 108/2021/ND-CP.

On what date will Circular 06/2023/TT-BLDTBXH come into force?

Regarding the effective date, under Article 4 of Circular 06/2023/TT-BLDTBXH:

Entry into force

1. This Circular comes into force as of August 14, 2023. Regulations of this Circular shall be implemented as of July 1, 2023. 

2. Clauses 1 and 2 Article 1, Article 2, Article 4, and Clause 2 Article 5 of Circular No. 37/2021/TT-BLDTBXH dated December 31, 2021 of the Minister of Labor - War Invalids and Social Affairs of Vietnam shall expire from the effective date of this Circular.

Difficulties that arise during the implementation of this Circular shall be reported to the Ministry of Labor - War Invalids and Social Affairs of Vietnam for study and settlement./.

Circular 06/2023/TT-BLDTBXH comes into force from August 14, 2023. The provisions of this Circular are implemented from July 1, 2023.