Proposal to adjust pensions from July 1

The Ministry of Labor, Invalids and Social Affairs proposed to increase pensions from July 1, 2023.

The Ministry of Labor, War Invalids and Social Affairs (MOLISA) proposed to increase pensions, social insurance benefits and monthly allowances by 12.5%; increase by 20.8% for subjects not yet adjusted in 2022, applicable from July 1, 2023... The draft was sent for comments to the Ministries of Public Security, Home Affairs; National Defense; Finance; Justice; Vietnam Social Security and the Central Committee of the Vietnam Fatherland Front.

In the Draft, the Ministry of Labor, War Invalids and Social Affairs proposed to increase by 12.5% ​​the pension, social insurance benefits and monthly allowances of June 2023 for those receiving pensions, social insurance benefits and monthly allowances guaranteed by the state budget.

In addition, since in 2022, only pensions will be adjusted without adjusting the basic salary, employees who have paid social insurance according to the salary regime prescribed by the State when retiring and receiving monthly social insurance benefits from January 1, 2022 until before July 1, 2023 will receive 7.4% lower than those who retired before January 1, 2022 (same working process, same salary coefficient) because during this period, employees are not allowed to adjust their social insurance-paid salaries because the basic salary has not been adjusted. Therefore, in these cases, the Ministry of Labor, War Invalids and Social Affairs proposes to increase by 20.8% on pensions, social insurance benefits and monthly benefits for June 2023.

In addition, the Ministry of Labor, War Invalids and Social Affairs also proposed adjustments for beneficiaries before 1995 with monthly pension and allowance levels below VND 3,000,000/person/month.

Specifically, those who received pensions, disability benefits and monthly allowances before January 1, 1995, after being adjusted to increase by 12.5% ​​according to the general adjustment level, but whose benefit level is lower than VND 3,000,000/month, will have their benefit level adjusted to increase by VND 300,000/person/month for those whose benefit level is from VND 2,700,000/month or less; increased by VND 3,000,000/person/month for those whose benefit level is from VND 2,700,000/month to less than VND 3,000,000/month.

With the above adjustment, it is expected that about 230,000 people receiving pensions and monthly allowances before January 1, 1995 will be subject to adjustment paid by the state budget, with an adjustment cost of about VND 330 billion. It is expected that the adjustment of pensions, social insurance allowances and monthly allowances will be implemented from July 1, 2023.

Previously, the National Assembly passed a Resolution on the 2023 state budget estimate, in addition to increasing the basic salary to 1.8 million VND/month, it also increased pensions and social insurance benefits by 12.5% ​​for subjects guaranteed by the state budget and provided additional support for those who retired before 1995 with low benefits.

In 2022, although the basic salary did not increase, many subjects received an additional 7.4% increase in pension and social insurance benefits according to Decree 108/2021/ND-CP.

According to statistics from Vietnam Social Security, there are currently nearly 3.3 million people nationwide receiving monthly pension and social insurance benefits.

According to current regulations, the minimum period of time for employees to participate in social insurance to receive pension must be 20 years. This is said to lead to many people having a short period of social insurance participation, so when they reach retirement age, they do not accumulate enough years of social insurance contributions to receive pension.

Therefore, in the construction of the Law on Social Insurance (amended), the Ministry of Labor, War Invalids and Social Affairs is proposing to reduce the minimum number of years of social insurance contributions to enjoy retirement benefits from 20 years to 15 years. Thereby, to create conditions for late-comer employees with a short period of social insurance participation to access and enjoy retirement benefits.