Guidance of the Ministry of Finance on the allocation of funds used from the salary reform source in Vietnam

Guidance of the Ministry of Finance on the allocation of funds used from the salary reform source in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

On January 25, 2024, the Ministry of Finance issued Official Dispatch 1058/BTC-KBNN regarding the allocation of funds used from the salary reform source in Vietnam.

Guidance of the Ministry of Finance on the allocation of funds used from the salary reform source in Vietnam 

The Ministry of Finance provides guidance on the allocation of funds used from the salary reform source. In accordance with Resolution 69/2022/QH15 on the state budget estimate for 2023, which includes implementing a basic salary increase for officials and public servants to 1.8 million VND per month from July 1, 2023, and continuing the implementation of Resolution 27/NQ-TW in 2018 on salary policy reform for officials, public servants, armed forces, and employees in enterprises, the Ministry of Finance provides guidance on the allocation of funds from the salary reform source to implement additional salary increases (from the current basic salary to the new salary) and continue the accumulation of the salary reform source as regulated, as follows:

(1) According to the budget classification in Official Dispatch 15601/BTC-KBNN in 2017 on budget accounting guidance, the central budget expenditure codes for the nature of expenditure 14—Funds for implementing salary policies, including allowances, subsidies, and benefits calculated based on the basic salary and social welfare—are referred to as the salary reform source.

(2) For the salary reform source monitored and managed by budget-using units:

- State Treasury units are responsible for accounting and separately monitoring the funds used for salary reform (expenditure code 14, monitoring the creation of funds for salary reform), and are not allowed to allocate the funds until there is a decision from the competent authority and transfer them to the following year as regulated in Clause 3 of Article 64 of the Law on State Budget.

Article 64. Settlement of state budget revenues and expenditures at year’s end

 

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3. The estimated expenditures, including additional expenditures in the year that are not enacted or completely enacted at the end of the budget year, including the time for adjusting state budget statement prescribed in Clause 2 of this Article, must be cancelled, except for the following expenditures which are permitted to be carried over to the next year and recorded in the next year’s budget:

a) Expenditure on development investment carried over to the next year’s budget according to the Law on Public Investment;

b) Expenditures on equipment purchase that have adequate documents and purchase contracts signed before December 31 of the enactment year;

c) Sources for implementation of wage policies;

d) Autonomous budgets of public service agencies and regulatory agencies;

dd) Estimates added by competent authorities after September 30 of the enactment year;

e) Funding for scientific research.

- Financial agencies and budgetary units at all levels are responsible for determining the amount used from the salary reform source to process salary increases from the current basic salary to the new salary outside of the salary fund in the budget allocation decision for budget-using units.

- Based on the decision of the competent authority regarding the budget allocation for budget-using units (using funds from the salary reform source to cover the additional increase from the current basic salary to the new basic salary), the State Treasury where the transaction is conducted will account for the transfer from the salary reform source (expenditure code 14) to the basic salary fund to implement the salary reform expenditure.

(3) For the accumulated salary reform source being monitored and managed at the budget level:

- When using the accumulated salary reform source being monitored and managed at the budget level to supplement the budget for salary reform expenditure, the financial agency will allocate the budget to the basic salary fund of the unit (without allocating the budget for the additional salary increase to the salary reform source - expenditure code 14).

- The State Treasury exercises control based solely on the budget allocation decisions of the competent authority.

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