Reducing the required number of years of social insurance contributions from 20 to 15 will enable more workers to receive a monthly pension.
This is the impact forecast of the 2024 Social Insurance Law on retirement pensions, as shared by the Ministry of Labour, Invalids, and Social Affairs.
According to the Ministry, the 2024 Social Insurance Law was promulgated to institutionalize Resolution No. 28-NQ/TW on reforming social insurance policies. The goal is to ensure that social insurance becomes a key pillar of the social security system, gradually and firmly expanding its coverage towards the goal of universal social insurance.
When the 2024 Social Insurance Law takes effect, the Ministry predicts that more workers will be able to participate in and fully benefit from compulsory social insurance regimes. These include household business owners with registered business operations; non-professional staff in communes, wards, and villages; and part-time workers whose monthly income is equal to or higher than the minimum compulsory social insurance contribution base salary.
Notably, more workers will be entitled to a monthly pension, monthly allowance, and stable income, along with health insurance coverage upon retirement.
This will be achieved by reducing the minimum required years of social insurance contributions to qualify for a pension from 20 years to 15 years. For workers with longer contribution histories, the pension entitlement ratio will remain unchanged, resulting in a higher pension compared to the current regulations.
Vietnamese citizens aged 75 and above who do not receive a pension or monthly social insurance allowance are entitled to a social retirement allowance.
Moving forward, the Ministry of Labour, Invalids, and Social Affairs will continue to coordinate with relevant ministries and sectors to advise the Government and propose solutions to improve pension levels for those with low pensions. This will ensure adherence to the Law’s principles, which include making reasonable pension adjustments for those with low pensions and those who retired before 1995.
Along with increasing the number of pensioners, the introduction of a social retirement allowance policy will contribute to a multi-layered social insurance system. This will enable more elderly individuals to receive social insurance allowances and ensure social security.
Vietnamese citizens aged 75 and above who do not receive a pension or monthly social insurance allowance are entitled to a social retirement allowance. Citizens aged 70 to 75 from poor or near-poor households who meet the conditions will also receive this allowance.
For workers who do not meet the requirements for a pension and are not yet eligible for a social retirement allowance, a monthly allowance regime will be introduced.
The Ministry of Labour, Invalids, and Social Affairs assesses that the 2024 Social Insurance Law will provide an important legal basis for individuals, businesses, and organizations to participate in the field of social insurance, especially in terms of contributing to and benefiting from its regimes and policies. This will ultimately contribute to ensuring social security.
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