Should the statutory pay rate be increased from January 1 or wait until July 1, 2023?

The National Assembly will discuss raising the statutory pay rate.

The Government of Vietnam proposes the highest increase in the statutory pay rate ever

According to the session program, on October 27-28, the National Assembly will discuss in the hall the results of the implementation of the socio-economic development plan for 2022; the anticipated socio-economic development plan for 2023; the implementation of the state budget in 2022, the state budget estimates, the public investment plan with state budget capital, and the central budget allocation plan for 2023.

Among the discussed contents, the National Assembly will deliberate on the Government of Vietnam’s proposal to increase the statutory pay rate from VND 1.49 million to VND 1.8 million for officials and public employees.

An increase in pensions, social insurance benefits funded by the state budget, and additional support for retirees before 1995 with low benefits; preference allowances for people with meritorious services and some social welfare policies; adjustment of professional preference allowances for preventive healthcare and primary healthcare staff.

This is the highest increase in salary ever, aimed at ensuring the retention of staff in the public sector, receiving wide support from the majority of National Assembly deputies, voters, and people.

This amendment aims to address urgent needs, as statistics from the Ministry of Home Affairs show that over the past two years, more than 39,500 officials and public employees have resigned, mainly due to salary policies not meeting their living needs.

Representative Pham Khanh Phong Lan: If it has been decided to increase the salary, it should be applied as soon as possible, possibly from January 1, 2023.

Increase the statutory pay rate as soon as possible, it can be applied immediately from January 1, 2023

Due to this urgency, Representative Pham Khanh Phong Lan of the Ho Chi Minh City National Assembly delegation expressed the view that increasing the statutory pay rate is necessary, although she acknowledged that increasing salaries might lead to higher prices, it still needs to be done.

However, if applying a comprehensive salary increase for the entire society, a large sum of money is needed, considering the current tough budgetary conditions.

Therefore, she proposed a method of selecting target groups, especially disadvantaged groups, to raise salaries, avoiding a uniform increase.

Because some people with high wage coefficients don't really need a salary increase and should share with others.

One of the reasons why staff in the education and healthcare sectors leave their jobs, leading to manpower shortages, is due to inappropriate salary policies.

According to Representative Pham Khanh Phong Lan, if it has been decided to increase the salary, it should be applied as soon as possible, possibly from January 1, 2023.

"When the Government of Vietnam presents to the National Assembly the plan to increase the statutory pay rate, it probably has arranged a budget source to implement such a salary increase.

Because by this time rolling out a salary increase is too late due to the objective reason of focusing resources on fighting the COVID-19 pandemic," said Representative Pham Khanh Phong Lan.

Representative Do Thi Lan: The timing of July 1, 2023, for the statutory pay rate increase is appropriate

The timing of July 1, 2023, for the statutory pay rate increase is appropriate

Expressing her opinion about the timing of the salary increase, Deputy Chairwoman of the National Assembly's Social Affairs Committee Do Thi Lan stated that it is already near the end of 2022, a full evaluation to identify beneficiaries of support policies and subsidies needs time.

Additionally, impact assessments and time to balance state resources and implement conformity with the proper use of the budget to meet socio-economic development demands...

Therefore, Representative Do Thi Lan stated that the timing of July 1, 2023, for the statutory pay rate increase to take effect is appropriate.

The Deputy Chairwoman of the National Assembly's Social Affairs Committee Do Thi Lan noted that the Government of Vietnam’s proposal to increase the statutory pay rate by over 20% has accounted for budget capabilities and consumer price indices, aligning with subsidy levels for disadvantaged groups and preferential allowances for those with meritorious services to the revolution.

The overall increase in both the statutory pay rate and related subsidy policies is suitable in the current context.

Increasing professional preference allowances requires a wider impact assessment

However, according to Deputy Chairwoman of the National Assembly's Social Affairs Committee Do Thi Lan, the increase in wages for any group must be fully considered and assessed, including: state sector employees, officials, and public employees; retirees, sectors facing much hardship and income disparities like teachers, healthcare workers...

In the immediate future, the Government of Vietnam proposes adjusting professional preference allowances for preventive healthcare and primary healthcare staff from January 1, 2023.

Deputy Chairwoman of the National Assembly's Social Affairs Committee Do Thi Lan emphasized the need for a wider impact assessment for other groups working in the health and education sectors and officials and public employees in state sectors to identify specific discrepancies to ensure salary increases are appropriate with the income levels of state employees.

Similarly, for those eligible for increased support policies and subsidies, consideration must be given to the dedication of people with meritorious services to the revolution, ensuring their living standards are equal to or higher than others living in similar conditions, thus the Government of Vietnam needs to deliberate on this issue.

Representative Pham Van Hoa: If salary increases are applied uniformly, then for those with low wage coefficients, the increase is insignificant, whereas for those with higher coefficients, leadership salaries can increase substantially.

The Ministry of Finance has meticulously calculated the salary increase

According to Representative Pham Van Hoa of the Dong Thap delegation, the proposal to increase salaries at this time is reasonable, based on careful calculations by the Government of Vietnam and the consultations of the Ministry of Home Affairs, the Ministry of Finance, and other relevant ministries and sectors.

Some opinions suggest increasing the statutory pay rate from January 1, 2023, however, according to Representative Pham Van Hoa, a salary increase from July 1, 2023, will align better with the economic and social conditions: "During the COVID-19 pandemic, the budget had to spend a significant amount on social welfare; budget revenues were low, except for 2022 when revenues exceeded targets.

However, applying the statutory pay rate increase will involve millions of officials and public employees, thus requiring a very large amount of budgetary expenditure.

As a result, the Ministry of Finance has carefully measured to ensure the salary increase does not deplete budget revenues but stems from regular expenditure savings by units over the years to implement the salary increase, and the state budget only covers a partial deficit."

If applied uniformly, the salary increase for those with low wage coefficients is insignificant

Representative of the Dong Thap delegation also stated that although the salary increase is not significant, it still holds substantial meaning, helping to stabilize the morale and work mindset of officials and public employees, especially those in the education and healthcare sectors who have low wage coefficients.

Currently, newly employed officials and public employees, even with allowance percentages included, only earn around VND 3-4 million per month, while market prices are rising, making it very difficult for state employees to sustain their living standards without a salary increase.

This is also one of the direct reasons why a considerable number of officials and public employees have resigned and moved to the private sector in recent times.

Addressing the calculation of salary increases, Representative Pham Van Hoa reckoned that although a uniform increase seems reasonable, for those with low wage coefficients, the increase is insignificant, while for those with higher coefficients, like leaders, the increase is quite substantial.

Therefore, the Government of Vietnam should meticulously calculate based on target groups and sectors, ensuring the overall wage fund does not overshoot the initial budget, while benefiting those with lower wages more significantly.

Especially, Representative Pham Van Hoa emphasized that in the future, there should be specific salary scales for sectors like education and healthcare.

Representative Ho Thi Minh: Applying the salary increase from January 1, 2023, would be more reasonable, as it is still a long time until July 1, 2023, with high inflation rates

Increasing the salary from January 1, 2023, would be more reasonable, as it is still a long time until July 1, 2023, with high inflation rates

In a discussion on the subject, Representative Ho Thi Minh of the Quang Tri delegation stated that the proposal to increase the statutory pay rate for officials and public employees to VND 1.8 million per month given the current economic context is acceptable.

However, she hoped for earlier application. With the current schedule of salary increases, Representative Ho Thi Minh noted it only meets part of the needs, as it is still a long time until July 1, 2023, with increasing inflation rates.

“While we have only the policy, stepping into the market, prices have already risen significantly. Certainly, the living standards of actual officials have not improved much.

I believe adjusting the application date to January 1, 2023, would be more reasonable. Additionally, salary increases should be scheduled appropriately, avoiding interruptions and delays like in recent times," Representative Minh recommended./.

According to the National Assembly's electronic information portal

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