National Assembly 'heats up' over budget allocation and public debt

(Baonghean.vn) - Responsibility must be assigned for the loss and waste that occurs in the context of limited state budget resources, difficulties, rapidly increasing public debt; the allocation of the "budget cake" is increasingly narrowing... are the "hot" issues that National Assembly deputies discussed enthusiastically in today's meeting (November 1).

According to the National Assembly's working agenda, this morning (November 1), the National Assembly discussed in the hall the 5-year financial plan; goals, orientations for mobilizing, using loans and managing public debt for the 2016-2020 period; and the medium-term public investment plan for the 2016-2020 period.

Overview of the meeting

Many National Assembly deputies expressed concern about the current situation of the state budget facing difficulties but public spending, especially the use of borrowed money, still has many shortcomings. In particular, 5 major projects with a total investment capital of over 30,000 billion VND, but when implemented, they fell into a state of unfinished or ineffective operation, even had to be "shelved", abandoned, and were on the brink of bankruptcy.

Agreeing with the assessment of National Assembly deputies that "public debt is increasing rapidly, debt repayment pressure is great", Minister of Finance Dinh Tien Dung said that in 2001, public debt only accounted for 36.5% of GDP; in 2005, this ratio had increased to 40.8% of GDP; in 2010 it was 50% of GDP and in 2015 it was 62.2% of GDP.

Minister of Finance Dinh Tien Dung speaks about public debt issue

In terms of scale, in 2015, total public debt was about 2.68 million billion VND, 2.3 times higher than in 2010, 7.6 times higher than in 2005 and 14.8 times higher than in 2001. The growth rate of public debt in the period 2011 - 2015 was 18.5%/year, 3 times higher than the economic growth rate.

In annual implementation, Vietnam must apply the debt restructuring plan: In 2013, 47,000 billion VND had to be restructured, just one year later, the debt restructuring figure increased to 106,000 billion VND and this figure in 2015 was 125,000 billion VND. In 2016, it is expected to continue to have to restructure 95,000 billion VND of debt.

However, the head of the Ministry of Finance also affirmed that in the past 2 years, the restructuring of public debt (including debt repayment terms and loan interest rates) has been significantly improved in the direction of "debt repayment terms being doubled and loan interest rates being halved".

Delegates discussed enthusiastically at the National Assembly.

Explaining the medium-term public investment plan, Minister of Planning and Investment Nguyen Chi Dung said that the current difficulty for the Government is that in the context of limited budget resources, there are currently two streams of opinion: On the one hand, it is believed that investment should be focused on a number of "locomotive" sectors, fields, and localities to create spillovers and contribute more and more to revenue; on the other hand, it is necessary to pay attention to disadvantaged localities to narrow the development gap.

In the afternoon session, the National Assembly continued to discuss in the hall the results of the implementation of the state budget in 2016; the state budget estimate and the plan for allocating the central budget in 2017.

Delegates exchanged on the sidelines of the meeting.

The atmosphere in the parliament became tense between two streams of opinion: One stream of opinion from delegates from disadvantaged localities said that the State should allocate resources for localities to stabilize people's lives and invest in urgent infrastructure projects.

Meanwhile, another opinion expressed that local budgets will be very difficult and struggling if regulation is sharply reduced (for example, Da Nang reduced the retained budget by 17% from 85% to 68% and Ho Chi Minh City reduced 5% from 23% to 18%).

Explaining to the National Assembly, Minister of Finance Dinh Tien Dung said that he hopes that the 16 localities that are regulated by the Central Government will share with the remaining 47 localities that are receiving subsidies from the state budget. The Ministry of Finance assessed that these 16 localities are like "golden gooses" for the state budget and need to share with the Central Government for the common cause of the country.

Gim Duong - Anh Tuan