Regulations on the Management and Utilization of Road Management and Maintenance Funds in Vietnam

The Circular applies to agencies, organizations, and individuals involved in the management and use of funds for road management and maintenance in Vietnam.

At the same time, the Circular clearly states, the Road Maintenance Fund is the State's fund, with legal personality, a seal, and an account opened at the State Treasury.

Circular on the funding sources of the Road Maintenance Fund in Vietnam

According to the Circular, the funding sources include: the central fund and the local fund.

The central fund includes the central budget allocated from the revenue from road use fees submitted to the central budget (65% of the total estimated nationwide road use fee collection); the central budget allocated as a supplement to the central fund; revenues related to road use and other sources as prescribed by law.

The local fund's sources include: The central budget allocated as a targeted supplement from the central budget to the local budget from road use fee revenue (35% of the total estimated nationwide road use fee collection); the local budget allocated as a supplement to the local fund; revenues related to road use and other sources as prescribed by law.

Funds for managing and maintaining national highways will be ensured by the central fund; funds for managing and maintaining local roads will be ensured by the local fund.

Regulations on allocation, advance, and payment of funds in Vietnam

The Circular specifies cases of fund allocation from the state budget to the central fund in the first quarter of the plan year, based on the estimated expenditure for national highway management and maintenance approved by the competent authority. The Central Road Maintenance Fund Management Council will request the Ministry of Transport to propose the Ministry of Finance allocate funds to the central fund account, up to 25% of the annual estimated expenditure.

In subsequent quarters, based on the work progress and fund disbursement, the maximum allocation for the second quarter is 35%, for the third quarter is 20%, and the fourth quarter is up to the remaining annual estimated expenditure.

For the allocation of funds from the state budget to the local fund, regarding the targeted supplement from the central budget to the local fund: Annually, based on the estimated targeted supplement expenditure from the central budget to the local budget for road management and maintenance approved by the competent authority and notified by the Ministry of Finance to each locality, the Department of Finance will allocate funds to the local fund according to the plan approved by the Provincial People's Committee.

For the supplement from the local budget to the local fund, the Department of Transport will coordinate with the Department of Finance to propose the Provincial People's Committee to specify the allocation level from the local budget to the local fund.

The Department of Finance will propose the Provincial People's Committee decide on the allocation method and quarterly disbursement schedule for the local fund in line with local requirements.

At the same time, according to the Circular, to ensure the Road Maintenance Fund is used for the right purposes and effectively, the Ministry of Transport, the Road Maintenance Fund Management Council, and the Department of Transport are responsible for cooperating with the relevant financial agencies to periodically or spontaneously check the management, use, and payment of the Road Maintenance Fund.

During management, if any expenditures not in line with the policies or stipulated contents in this Circular and current legal documents are detected, they must be deducted and recovered to the Road Maintenance Fund (both central and local) according to the administration level; and the individual who made the wrong expenditure decision must be held accountable according to the law.

Circular 60/2017/TT-BTC takes effect from August 1, 2017, and applies from the 2017 budget year, replacing Joint Circular 230/2012/TTLT-BTC-BGTVT dated December 27, 2012, from the Ministry of Finance and the Ministry of Transport guiding the policies for managing, paying, and settling the Road Maintenance Fund.

For expenditure items of an investment nature as stipulated in Joint Circular 230/2012/TTLT-BTC-BGTVT which have been allocated estimates and funds before Circular 60/2017/TT-BTC takes effect, funding will continue to be provided (for the remaining estimate, if any) until the task is completed.

Source: Finance Magazine

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