The Government has agreed to propose not to abandon the Petroleum Price Stabilization Fund for the time being.

Panorama of the working session on the afternoon of November 2 at Dien Hong Hall, National Assembly House. Photo: Quochoi.vn

On the afternoon of November 2, the 4th Session of the 15th National Assembly continued working at Dien Hong Hall under the direction of Vice Chairman of the National Assembly Nguyen Khac Dinh.

The National Assembly listened to Minister of Finance Ho Duc Phoc, authorized by the Prime Minister, present the Report on the draft Law on Prices (amended).

Price Law No. 11/2012/QH13 was passed by the National Assembly at the 3rd Session of the 13th National Assembly, effective from January 1, 2013, replacing the 2002 Price Ordinance. After 9 years of implementation, the Price Law has come into effect, achieving many positive results; at the same time, there have been problems and limitations, especially the consistency and synchronization between the Price Law and other specialized Laws with regulations on prices.

Vice Chairman of the National Assembly Nguyen Khac Dinh chaired the meeting. Photo: Quochoi.vn

The Draft Law on Prices (amended) consists of 8 chapters and 72 articles. Compared to the current Law, 3 chapters have been added on the content of state management of prices, price appraisal and the tasks and powers of state agencies; the work of synthesizing, analyzing and forecasting market prices and on inspecting compliance with the law on prices and price appraisal to strengthen the legal basis for implementing this task in practice.

The Draft Law on Prices (amended) removes from the List 14 goods and services that do not comply with the four criteria for determining goods and services priced by the State as set out in the Law and implemented according to the market price mechanism; at the same time, the Government proposes to add two items to the List of goods and services priced by the State, which are textbooks and goods and services serving national defense and security tasks, which are ordered and assigned to defense and security units and enterprises. Thus, the list of goods and services priced by the State includes 40 groups of goods and services.

Minister of Finance Ho Duc Phoc presents the Proposal on the draft Law on Prices (amended). Photo: Quochoi.vn

Regarding the price stabilization policy, Minister of Finance Ho Duc Phoc affirmed that the draft Law only stipulates the principles for determining the list of goods and services with price stabilization and assigns the Government to provide detailed regulations to ensure flexibility in implementation. The basic price stabilization measures are inherited from the current Law, but are adjusted according to the policy content.

Besides, although the draft revised Law on Prices does not stipulate direct adjustments to the Petroleum Price Stabilization Fund, the provisions on establishing a price stabilization fund in the Law will also have certain impacts on the legality of the Petroleum Price Stabilization Fund.

Accordingly, the Petroleum Price Stabilization Fund is a special fund, established before the provisions on the price stabilization fund in the Law on Prices. Unlike other financial funds, the Petroleum Price Stabilization Fund is formed and managed for the sole purpose of contributing to stabilizing petroleum prices; there is no organizational structure and no centralized management. The total annual deduction depends on domestic petroleum consumption; the total usage depends on market developments, inflation control goals and macroeconomic stability in each period and each price management period. In fact, the provisions in the Law on Prices only have a certain impact, in the direction of strengthening the legal basis of the Petroleum Price Stabilization Fund.

Up to now, there have been many different opinions on the Petroleum Price Stabilization Fund; however, based on careful assessment, it has been shown that the price movements of this commodity have been complicated and difficult to predict, so the Petroleum Price Stabilization Fund is still necessary. Therefore, the Government has agreed to propose not to abandon the Petroleum Price Stabilization Fund for the time being; at the same time, to strengthen the mechanisms in implementation and organization to increase publicity and transparency in the use of the Fund.

Chairman of the National Assembly's Finance and Budget Committee Nguyen Phu Cuong presents the Report on the review of the Law on Prices (amended). Photo: Quochoi.vn

Presenting the Report on the review of this Law project, Chairman of the National Assembly's Finance and Budget Committee Nguyen Phu Cuong emphasized that, in principle, the application of price stabilization must ensure: Stabilization on the basis of regulation through economic measures such as supply-demand coordination; for some goods, there must be a suitable price framework; good control of price fluctuations, thereby curbing inflation or deflation; minimizing intervention by administrative orders, contrary to market rules; limiting the application of price support measures through direct use of the state budget to compensate for prices and losses.

The Chairman of the National Assembly's Finance and Budget Committee said: Regarding the Petroleum Price Stabilization Fund, the majority of opinions of the Finance and Budget Committee suggested that it should be innovated in the following direction: Maintaining the Petroleum Price Stabilization Fund should have a time limit and time, and gradually operate according to the market; Managing the Petroleum Price Stabilization Fund requires more flexibility, efficiency, and timeliness; it is necessary to strengthen management responsibility, promote publicity and transparency before the people. However, some opinions suggested not to continue maintaining the Petroleum Price Stabilization Fund.

National Assembly delegates from Nghe An Delegation at the working session at Dien Hong Hall, National Assembly House on the afternoon of November 2. Photo: Quang Vinh

Regarding the list of goods and services whose prices are determined by the State; especially related to textbook prices, Chairman of the Finance and Budget Committee Nguyen Phu Cuong emphasized: This is an essential commodity with a very wide scope of influence, directly affecting people, including low-income people. Therefore, it is necessary to control and regulate prices to ensure that they do not negatively impact consumers, to create a tool to protect the legitimate rights of people, especially the poor.

Next, the National Assembly discussed in the hall the draft Resolution promulgating the Rules of Procedure for the National Assembly Session (amended). After that, Member of the National Assembly Standing Committee, Secretary General of the National Assembly - Head of the National Assembly Office Bui Van Cuong spoke to explain and clarify a number of issues raised by National Assembly deputies.