State budget
Most deputies said some criteria in the State budget estimates were not practical. Deputy Dinh Xuan Thao said that if the State Budget Law was not amended, it would be very difficult to build a suitable budget based on the country's real needs.
Deputy Nguyen Ngoc Hoa said this year's total budget spending exceeded the target which proved that fiscal policy tightening had not been well implemented. Next year, revenue could fall from the impact of crude oil prices and land use fees.
Deputy Tran Du Lich said the method used to allocate the budget should be amended soon, as it was currently equal between localities which made it difficult to minimize budget spending.
A dramatic change to the budget allocation method would require insight into Government revenues at both the central and local levels, he said. In poor provinces, public services could be subsidized by the State while wealthy provinces could use their own revenue to pay for public services. Any funds from the State budget used to finance public services must be monitored.
Budget allocation should be made clear and public at National Assembly meetings, said Deputy Tran Hoang Ngan.
Due to a limited budget, the Government should identify specific areas for reasonable budget allocation, said Deputy Pham Quang Nghi, adding that it should determine the most urgent issues and conduct in-depth analyses on specific areas, in order to determine which provinces or sectors needed an increase or decrease in their budget allocation.
Sharing this view, Deputy Dao Trong Thi proposed maintaining the budget allocation for cultural and social activities by focusing on social security, education and health care. Thi noted that some localities had not used their budget allocation properly.
For example, the State divided its human resources budget into two sections, salary and professional activities. Salaries were to make up 80 per cent of that budget while professional activities were to account for the remainder. However, in some localities, only 5 per cent of the budget was used for professional activities. Strict management and monitoring measures should be developed to ensure proper spending, he said.
If investment in professional activities was ignored, State employees would be unable to make good contributions to the country's socio-economic development, so budget allocation for salaries and professional activities should be balanced, the deputies agreed.
Trinh The Khiet said State budget allocation should be focused on the development of key transport systems, infrastructure facilities and sciences which were vital to developing the economy.
According to the 2011 State budget report, the year's total spending was estimated to exceed the target by 9.7 percent, or VND70.4 trillion (US$3.3 billion).
Government debt – safe or unsafe?
Deputy Tran Du Lich said it is important to make comparison between mature debts with budget revenue. For example, this year Vietnam has to pay VND86 trillion of debts, accounting for 12.5 percent of budget revenue but next year it will have to pay VND100 trillion, or 13.5 percent of budget revenue. In this case, the increase of budget revenue is only enough to pay debts.
Deputy Tran Hoang Ngan said that government debt and foreign debt of Vietnam is at alarming level, not at safe threshold because overspending has prolonged for years.
Ngan analyzed: it is estimated that by the end of 2011, government debt will account for 54.5 percent of GDP, particularly foreign debt to account for 41.5 of GDP, equivalent to $50 billion. Foreign debt is three times higher than Vietnam’s current foreign currency reserves.
Meanwhile, Thailand’s government debt accounts for only 44.1 percent of GDP, while its foreign currency reserve is $176 billion. The figures are 26.9 percent for Indonesia and Malaysia and 47.3 percent for the Philippines.
“Looking at their government debt to see that our government debt at 54.5 percent is at dangerous level,” Ngan said.
Deputy Vu Trong Kim said that appropriate government debt recommended for developing countries is around 40 percent of GDP and 60 percent for developed countries. He questioned is it okay when the government debt/GDP rate is on the rise for Vietnam?
Minister of Finance Vuong Dinh Hue explained that Vietnam’s government debt increases because Vietnam needs capital for development and because of exchange rate.
“In 2011 the exchange rate between the Vietnam dong and the USD increased by 9.3 percent. It means that out foreign debt rises at the same rate,” Hue said. Moreover, GDP growth in recent years is under expectation, he added.
In the government’s report, government debt is estimated at 54.6 percent of GDP by December 31, 2011, and 58.4 percent in 2012.
Hue confirmed that Vietnam well controls its debt but he emphasized that the NA and the government must be very careful. He said that the Financial and Debt Management Agency will be set up.
Who will take responsibility?
Deputies worried about waste in government spending. According to the NA Committee for Finance and Budget, there are up to 333 newly-launched projects that are funded by government bond though they are not listed as projects of that type.
“Our policy is cutting down government spending but government investment still exceeds 15.1 percent, why?--a deputy from Cao Bang asked?
“All officials want to increase investment for their provinces and sectors so we cannot avoid scattered investment,” Deputy Nguyen Hong Son said.
Deputy Pham Quang Nghi spoke: “Deputies complained of scattered investment, but who of 500 deputies will dare to represent their provinces and sectors to take responsibility and voluntarily ask to cut down government investment in their locations and sectors? And he answered: “It is difficult!”
Law on petitions
Later the same day, deputies discussed the draft Law on Petitions. During the discussion, most deputies agreed with amendments and supplements to the draft law proposed by the NA Standing Committee.
However, many deputies proposed the drafting committee clearly identify the powers and responsibility of designated administrative offices and agencies in settling petitions to prevent overlaps.
Deputy Ha Cong Long said the draft law should clearly identify the responsibilities for relevant agencies to help people lodge petitions.
"Administrative agencies should review their administrative decisions to make sure the decisions are in line with laws," said Deputy Nguyen Thi Kim Thuy.
Deputy Ho Thi Thuy proposed the law should regulate that people would be allowed to lodge petitions against all kinds of administrative documents to protect their rights and interests.
"The draft law currently only allows people to petition administrative decisions and administrative actions by State-run administrative agencies," she said.
Some deputies proposed stricter regulations to prevent those who want to make use of petitions to slander and distort the reputation of organizations, agencies and other people.
Phuong Loan – Thuy Chung
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