Gov't may recall unused funds for public investment projects

May, 20/2022 - 08:16

Undisbursed funds for public investment projects could be recalled if local governments failed to implement said projects for an extended period of time, said Deputy Prime Minister Lê Minh Khái in a meeting with local officials in Hà Nội on Thursday.

  

Deputy PM Lê Minh Khái during a meeting with local officials on the disbursement of funding for public investment projects on May 19. — VNA/VNS Photo

HÀ NỘI — Undisbursed funds for public investment projects could be recalled if local governments failed to implement the projects for an extended period of time, said Deputy Prime Minister Lê Minh Khái in a meeting with officials of five provinces in Hà Nội on Thursday.

According to the Ministry of Finance, funds allocated to five provinces, namely Vĩnh Phúc, Phú Yên, Khánh Hòa, Bình Thuận, Bình Phước, in 2022 will be VNĐ26.6 trillion (US$1.2 bilion), including VNĐ5.7 trillion from central budget and the rest from local budgets.

However, according to the State Treasury, as of May 15 this year, the five provinces managed to disburse just over VNĐ5.5 trillion or 20.7 per cent of the year's target. Of which, nearly VNĐ4.2 trillion came from local budget, VNĐ1.28 trillion from central government budget and more than VNĐ40 billion from ODA sources.

Deputy Chairman of Vĩnh Phúc People's Committee Vũ Việt Văn said the country's existing regulations on public investment have been showing shortcomings and limitations.

For example, he said the law required local governments to present public investment projects to the People's Council but the council only holds 2-3 meetings a year, making it near impossible for them to meet such requirements. 

Another issue was the land clearance procedure which is not allowed to start before a project received its final approval, significantly slowing down the speed at which a project can be implemented. 

As land clearance and compensation typically required a large amount of money, a bottlenecked process could potentially tie up trillions of funding. 

Lê Ngọc Tiến, director of Bình Thuận Province's Department of Planning and Investment, said it's high time the Government establish a detailed guideline for land clearance process to avoid confusions down the line.

Minister of Finance Hồ Đức Phớc said his ministry is to collect and study all feedbacks by local officials and that the Government has been working around the clock to address said issues. However, he said disbursement for public investment projects has been too slow and too behind schedule. It was a cause for concern, especially in light of recent inflation waves, rising construction material prices and wages.

As a temporary solution, he suggested local governments to assign high-ranking officials to closely oversee the land clearance process. He said once all necessary steps are completed, his ministry only require no more than 72 hours to transfer the funds. 

He said the country's top priority right now is to quickly improve its infrastructure, a key component in speeding up economic recovery. As the National Assembly approved a VNĐ350 trillion economic recovery package, nearly one-third of it has been earmarked for infrastructure building. — VNS