The Ministry of Finance has just sent a letter to the Ministry of Labor, Invalids and Social Affairs regarding the impact assessment of the new salary reform from July 1 (implementing social insurance policies).
Accordingly, the Ministry of Finance proposes that the Ministry of Labor, Invalids and Social Affairs recalculate the proposed pension increase, social insurance allowance by 15%; increase the preferential allowance for revolutionary contributors by 29.2% (from 2,055,000 VND to 2,655,000 VND per month); increase the social support standard by 38.9% (from 360,000 VND to 500,000 VND per month).
With the above increase, the total payment budget is 17,276 trillion VND, 2.3 times the approved budget source of the National Assembly, surpassing the balancing capacity of the state budget estimate for the second half of this year.
“The central budget is difficult, the allocation of money for pension increase and limited allowances while some localities have surplus resources for salary reform. In order to reduce pressure on the state budget and proactively allocate financial resources, the Ministry of Labor, Invalids and Social Affairs reports to the competent authority to allow the use of accumulated resources from the central government and the surplus money of localities after salary reform for these policies,” the Ministry of Finance suggested.
Pensioners receiving pensions at the social insurance payment point. (Illustrative photo).
The Ministry of Labor, Invalids and Social Affairs is currently drafting policies on pension increase, social insurance allowances, monthly allowances, and preferential allowances for revolutionary contributors. The increase will take effect from July 1, 2024, coinciding with the increase in basic salary and minimum wage in the region.
Currently, Vietnam has nearly 3.4 million pensioners, monthly social insurance allowances from the Social Insurance Fund, and 1.8 million people receiving social pension subsidies from the state budget.
Vietnamese pensioners receive a maximum pension of 75%. However, due to low income used for insurance contributions, the average pension only reaches 5.4 million VND/person/month.
From 2016 – 2023, the Government has adjusted pensions and monthly social insurance allowances 6 times with respective adjustments: 8% (2016); 7.44% (2017); 6.92% (2018); 7.19% (2019); 7.4% (2022); 12.5% (2023) on the current pension amount.
