Bùi Quang Vinh, Minister of Planning and Investment. — Photo tuoitre.vn

Bùi Quang Vinh, Minister of Planning and Investment, spoke to the newspaper Tiền Phong (Vanguard) about money disbursement in the central and local budgets.

Are there any mechanisms in place to sanction violations of the 2014 Law on Public Investment?

Under the 2014 Law on Public Investment, new projects using either the State or local budget can only be started when the funding is available.

Since it came into force on January 1, 2015, the Law has been applied to projects using the State budget, not yet with the local budget.

Since early 2016, the State Audit Office, the State Inspectorate and the Ministry of Planning and Investment have organised several inspection visits to provinces with projects using the State budget. Prior to those inspection visits, we were granted the right to temporarily stop any non-compliant projects and report them to the government.

If the project owners didn’t follow our recommendations, we would cut off the funding immediately.  

In addition, the National Assembly and Prime Minister Nguyễn Tấn Dũng have adopted resolutions that say that any locality wanting to start a new project using the State budget must first submit a report on the final financial settlement for old projects in their province.

Many people have complained that there remain quite a few problems with public investment projects and the handling of outstanding debts. How do you respond to these complaints?

Basically, outstanding debts will be solved in the coming five years, as these debts are managed by the central government.

Under our law, the central capital, which comes from the State budget, is managed and allocated by the Ministry of Planning and Investment (MPI)  with approval from the Prime Minister. That’s why our ministry has the right to handle outstanding debt.

In addition, under the Law on Public Investment, there is no chance for ministries or localities to start a project without money approved by the MPI and the Prime Minister.

However, with infrastructure construction projects using the money managed by local governments, they are subjected to the authorisation of local governments. I’m confident that when the central budget is put under tight control, it will have a strong impact on local budget control. But, it will take time and cannot be done overnight.

Outstanding debts remain a big problem in Việt Nam. Do you agree?

I couldn’t agree more. Outstanding debt in infrastructure construction is an ongoing process. Construction projects always surpass the amount of money the project owners have paid them. That’s why outstanding debt  in infrastructure construction is a normal issue everywhere in our country.

However, for the case of outstanding debt in projects funded by the central budget, I say – no problem. They are under control. For example, the Ministry of Transport owes VNĐ13,000 billion (US$583 million) and is on the right track. That amount will certainly be settled within the next five years.

What I’m worried about is the debt owed by local governments. I hope the next Government will work out a plan to ensure that the budget controlled by local governments will be as strictly controlled as the central budget. As I have mentioned, the Central Government has no right to impose their will on how local governments should spend their money. — VNS