Minister of Finance Ho Duc Phoc: The petrol price stabilization fund has the task of 'reducing shock' when prices fluctuate.

On March 15, the National Assembly Standing Committee held its 21st session to give opinions on a number of major issues and content with different opinions on the draft Law on Prices (amended), including regulations on the petroleum price stabilization fund.

The stabilization fund is just one solution.

Presenting a report on some major issues and contents of this draft law that still have different opinions, Chairman of the Finance and Budget Committee Nguyen Phu Cuong said that the current law stipulates that, if necessary, a price stabilization fund will be established for goods that need price stabilization in the list of goods and services subject to price stabilization. In fact, currently, only the gasoline price stabilization fund is operating with the aim of price stabilization.

The Standing Committee of the Finance and Budget Committee agrees to keep the provisions on price stabilization funds in the law to ensure a legal basis for the operating petroleum price stabilization fund.

Chairman of the Finance and Budget Committee Nguyen Phu Cuong. Photo: Pham Thang

However, to ensure greater legal effectiveness, the Standing Committee of the Finance and Budget Committee proposes to stipulate that the National Assembly has the authority to establish a fund during the period between two sessions. In urgent cases, the Standing Committee of the National Assembly shall decide on the establishment of the fund and report to the National Assembly at the nearest session.

However, the drafting agency proposed that the Government regulate the establishment to ensure flexibility in implementation. Therefore, the draft law designs two options to report to the National Assembly Standing Committee for consideration.

Chairman of the Law Committee Hoang Thanh Tung expressed his agreement with the continued maintenance of the petrol price stabilization fund. However, this content is not a decision of the law. Therefore, the law does not specifically mention this fund.

“This is the Government's authority, but in terms of viewpoint, we agree to continue maintaining the petrol price stabilization fund,” said Mr. Tung.

National Assembly Chairman Vuong Dinh Hue proposed studying renaming the price stabilization fund to a broader term of “price stabilization measures.”

The National Assembly Chairman noted that management must ensure the harmony of interests between the State, the people, and businesses, especially protecting the interests of the disadvantaged. In reality, there are also very unexpected situations such as natural disasters, enemy attacks, fires, and emergencies, in which case the State can make special decisions...

“The fund is just one solution. The National Assembly agrees that the fund should be maintained and suggests continuing to study and perfect the management mechanism so that the fund is public, transparent, and harmonizes interests,” the National Assembly Chairman emphasized.

It is necessary to promote publicity and transparency about the status of fund sources and usage.

Chairman of the Economic Committee Vu Hong Thanh said that at the recent session on the issue of gasoline organized by the committee, many opinions said that the gasoline price stabilization fund has not ensured its proper purpose.

Mr. Thanh cited that on June 21, 2022, gasoline prices were at their "peak" but this fund had no impact on reducing prices.

"Whether to keep it or not is a very troubling issue," Mr. Thanh said, adding that the Standing Committee of the Economic Committee has two opinions on this issue.

Expressing his personal opinion that this fund should be retained, Mr. Thanh also suggested that the shortcomings and problems in the fund's management in the past must be overcome and that a separate assessment must be made to handle the fund's issues to ensure proper operation.

Chairman of the Finance and Budget Committee Nguyen Phu Cuong suggested that in management and operation, the Government should promote publicity and transparency in the status of sources and use of funds, improve timeliness and practical efficiency, especially when there are fluctuations. At the same time, the Government needs to have a roadmap to soon bring Vietnam's gasoline prices to operate completely according to market rules.

Minister of Finance Ho Duc Phoc. Photo: Pham Thang

Explaining this content, Minister of Finance Ho Duc Phoc emphasized that the petroleum price stabilization fund has the task of "reducing shock" when prices fluctuate, and is a tool for state agencies.

If this fund is removed, the price impact tool will be less, the State's orientation will decrease, while this is a product that has a great influence on all people.

The Minister of Finance added that the Government is currently researching how to manage and operate the petrol price stabilization fund most effectively. The Ministry of Finance has proposed to include this content in the revised Decree 95 for more complete and timely management.

Thu Hang