Proposal to remove the regulation that state-owned enterprise leaders must be civil servants

The Ministry of Home Affairs is seeking public comments on the draft Law amending and supplementing a number of articles of the Law on Civil Servants and the Law on Public Employees, including a proposal to remove the regulation that leaders at state-owned enterprises must be civil servants or public employees.

Explaining this proposal, the Ministry of Home Affairs said that although the Law on Public Employees and the Decrees have relatively detailed regulations, in reality the number of public service units is very large, diverse in types, fields of operation and methods of organization and management, so there are still different understandings of "leadership and management apparatus", leading to many difficulties in application.

In reality, because public service units are not allowed to perform state management functions and do not carry out public service activities, except for some units serving political tasks and state management, civil servants in the leadership and management apparatus of public service units are not entitled to public service allowances and most public service units are not assigned public service payrolls.

On the other hand, among the civil servants in the leadership and management apparatus of public service units who have been appointed to professional titles and carry out professional activities, there are very few cases of transfer to hold civil service ranks. This leads to difficulties and inconsistencies in the implementation of regimes, policies and management mechanisms for these people.

Some subjects such as Chairman of the Board of Directors, members of the Board of Directors, General Director, Deputy General Director, Director, Deputy Director, Chief Accountant and those holding leadership and management positions in enterprises according to the provisions of the Law are also subject to the same regulations on planning, appointment, reappointment, evaluation, dismissal and discipline as civil servants.

However, due to the specific nature of business operations being different from administrative agencies, the implementation of regulations on planning, appointment, reappointment, evaluation, dismissal, and discipline of leaders and managers in businesses still has problems and is not suitable; it does not meet the requirements of building a team of leaders and managers of businesses in the new period.

This also leads to shortcomings in actual implementation because the nature of performing public duties is different from business activities, so the regime cannot be applied to these subjects as it is to civil servants.

To resolve the above shortcomings, promote socialization, enhance autonomy, self-management, and self-responsibility of public service units; separate the state management function from the owner's management function for state-owned enterprises, the Ministry of Home Affairs proposes not to define civil servants as civil servants for leadership and management positions in public service units, except for public service units serving political tasks and state management.

According to the Ministry of Home Affairs, there are currently approximately 58,000 public service units nationwide. If each public service unit has an average of 10 people in the leadership and management apparatus, then there are up to 58,000 people in the public service unit sector subject to the Law on Civil Servants.

This directly affects the cost of training, time and material for meetings, reviews, and evaluations as civil servants, not to mention the arising costs when having to consult competent authorities on related issues. Not defining this group as cadres and civil servants will help the state budget save hundreds of billions of dong each year, not to mention invisible costs.

The draft amended Law is being widely consulted by the Ministry of Home Affairs until March 24, 2019.