What are regulations on delegating financial autonomy to public administrative units in Vietnam? What are responsibilities of public administrative units in Vietnam?

What are regulations on delegating financial autonomy to public administrative units in Vietnam?

Pursuant to Article 35 of the Decree 60/2021/ND-CP stipulating delegating financial autonomy to public administrative units in Vietnam as follows: 

1. Public administrative units shall plans to exercise their autonomy for 05-year stabilization period which is relevant to the social and economic development period stipulated by the Government; estimates of revenues and expenses in the first year of the stabilization period and proposals of their levels of financial autonomy which must be conformable with the functions and tasks assigned by competent authorities (using the form in Appendix II enclosed herewith), and submit them to their superior agencies (ministries or central agencies in case the public administrative units are managed by central government) or provincial People’s Committees (in case the public administrative units are managed by provincial government). The plan to exercise autonomy must indicate the level of financial autonomy according to 04 groups of units prescribed herein.

2. In case a public administrative unit has affiliated administrative units

a) The public administrative unit shall develop the plan to exercise autonomy and submit it to its superior public administrative unit for approval after obtaining the consent from the superior agency.

b) The superior public administrative unit shall develop the plan to exercise its autonomy (excluding the plans to exercise autonomy of its affiliated administrative units as prescribed in Point a of this Clause) and send it to the superior agency.

3. Based on the plans to exercise autonomy submitted by public administrative units (excluding those of the public administrative units specified in Point a Clause 2 of this Article), superior agencies shall consider and verify estimates of revenues and expenses in the first year of the stabilization period and determine funding for recurrent expenses derived from state budget and retained amounts of collected fees; funding from state budget for ordered public administrative services (in case funding for ordered services can be determined at the time of verification of the plan to exercise autonomy); classification of affiliated units according to levels of their financial autonomy, consolidate and send classification plan and estimates of revenues and expenses of public administrative units to finance authorities of the same level (Ministry of Finance or provincial finance authorities as prescribed) for consideration.

After obtaining written opinions from the finance authorities of the same level, the superior agencies shall classify the public administrative units and issue decisions to grant the financial autonomy to their affiliated public administrative units; approve estimated funding for recurrent expenses derived from state budget and retained amounts of collected fees; funding from state budget for ordered public administrative services (if any) allocated to the units under the plan to exercise autonomy in the first year of the stabilization period.

4. After each stabilization period of 05 years, ministries and central agencies (in case the public administrative unit is managed by a central agency) or provincial People’s Committees (in case the public administrative unit is managed by a provincial agency) shall review and improve the levels of financial autonomy of group-3 units (except public administrative units that provide basic and essential public administrative services and earn no revenues from administrative operations) according to the following roadmap:

a) Transfer at least 30% of the number of public administrative units that self-cover from 70% to less than 100% of recurrent expenses into group-2 units; annually, reduce at least 2,5% of funding derived from state budget;

b) Transfer at least 30% of the number of public administrative units that self-cover from 30% to less than 70% of recurrent expenses into public administrative units that self-cover from 70% to less than 100% of recurrent expenses; annually, reduce at least 2,5% of funding derived from state budget;

c) Transfer at least 30% of the number of public administrative units that self-cover from 10% to less than 30% of recurrent expenses into public administrative units that self-cover from 30% to less than 70% of recurrent expenses; annually, reduce at least 2,5% of funding derived from state budget.

5. Public administrative units that have been classified by competent authorities as group-1 or group-2 units shall continue exercising financial autonomy in accordance with regulations herein; shall not be considered to be transferred into group-3 or group-4 units during the stabilization period of 05 years or after the stabilization period of 05 years, except case of force majeure events (such as disasters or epidemics) or cases where the unit’s functions, tasks and powers have been adjusted by competent authorities in accordance with regulations of law resulting in changes to revenues earned by the unit and its level of financial autonomy.

Group-1 and group-2 units shall provide required documents and reports for superior agencies for allocating land and public assets in accordance with regulations of relevant laws.

6. The superior agencies shall carry out restructuring or dissolution of public administrative units that have insufficiently operated according to Government's regulations on establishment, restructuring and dissolution of public administrative units.

What are responsibilities of public administrative units in Vietnam?

Pursuant to Article 38 of the Decree 60/2021/ND-CP stipulating responsibilities of public administrative units in Vietnam as follows: 

1. Bear responsibility to their superior agencies and take legal liability for decisions to exercise their financial autonomy.

2. Ensure that their provided public administrative services meet quality standards or criteria stipulated by competent authorities.

3. Formulate and implement regulations on internal expenses, asset use, grassroots-level democracy, financial disclosure and internal audit in accordance with applicable regulations.

4. Implement regulations on public disclosure; take accountability for their operations and data on revenues and expenses included in the plan to exercise autonomy before their supervisory authorities, state regulatory authorities, audit agencies and inspection agencies as prescribed by law. Annually, the public administrative unit shall assume responsibility for reports on assessment of implementation results of its financial autonomy submitted to its superior agency as prescribed.

Best regards!