State
budget allocation is hot on the National Assembly’s agenda. National Assembly
Economic Committee deputy chairman Mai Xuan Hung sheds some light on the issue.
The government showed strong determination
towards reforming budget allocation, linking it closely to economic
restructuring with priority given to key and focal projects. Is this reflected
in 2012’s state budget plan?
In my view, 2012 budget allocation plan the
government has submitted the National Assembly for approval envisages some
improvements. First, assignment relative to government bond capital is set on
medium-term but not on annual basis and programme-based as previously. Second,
the government told the National Assembly it would concentrate investment into
key projects which can be finalised within 2012 and at most 2013. In doing that
state budget is being distributed in a way with retrenching public investment.
Notwithstanding, though public investment is
being curtailed, it is impossible to reduce the capital volume put into
investment development in current context of difficult economic development.
Therefore, for projects that welcome investment from assorted economic sectors
the government should give birth to investment incentives to lure firms via
diverse models such as build-operate-transfer (BOT) or public private
partnerships (PPP).
Besides, national projects and works operating
inefficiently can be given to firms to help the government recoup investment
except for some public welfare projects with low near-term economic benefits.
Are there any hurdles in the process of
selecting projects subject to curtailing public investment?
The issue tops the National Assembly agenda
these days. For instance, from now until 2012 we may only have VND225 trillion
($10.86 billion) government bond capital whereas as much as VND600 trillion
($29 billion) would be needed to pump into projects currently in the
development pipeline using government bond capital.
Deputies are digging into what would be
criteria for public investment cuts. Priority should be given to projects
having two-thirds of total investment being disbursed for early completion. However,
such projects are many. Introducing proper criteria for budget capital
allocation is then imperative which must be handled quickly.
The public said that budget capital usage
efficiency at national target programmes remained low, while the government
recommends 16 target programmes for 2011-2015. What is your view?
This has been a hot issue for a long time.
National target programmes are in fact constantly rising. Most these programmes
source investment capital from state coffers.
In fact, there were cases the capital amount
given to local governments for carrying out target programmes was too low
failing to meet audit criteria for construction projects. Therefore, I suggest
combining these 16 national target programmes and over 30 current supportive
programmes to have less than 10 programmes in total.
Besides, budget should be allocated in the
medium term from three to five years. Along with capital distribution,
provincial leadership shall be responsible for capital expenditure plans and
realising assigned state programmes. They should bear responsibility before the
government for failures in implementation.
Thuy Lien | vir.com.vn
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