Amending special mechanism: Propose to increase the credit balance rate for Hanoi City

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Illustrative photo. Source: Internet

One of the most important contents of this draft is to amend the credit balance of the city’ budget from not exceeding 70% to not exceeding 90% of allocated local budget revenues.

Local budget revenues are determined on the basis of city budget revenue estimates approved by the National Assembly for the year. The total annual loan and overspending is decided by the National Assembly in accordance with the State Budget Law.

Supplementing provisions thePeople's Committee of Ha Noi City is allowed to advance from the financial reserve fund to invest in important infrastructure projects in the city’s expenditure plan, which do not have capital allocated in the medium-term public investment plan or need additional capital to promote the progress. The advance time is no more than 36 months from the date of advance.

For the expenditure of State budget estimate, the Ministry of Finance proposes that based on annual State budget estimate approved by the National Assembly and assigned by the Government and based on the situation of the City, the City People's Council shall estimate and allocate budget in line with the direction of budget restructuring and socio-economic development and key sectors.

The drafting agency also supplements that the city shall implement mechanisms to create sources to reform wages.

After the City’s budget is sufficient to reform salary and social security policies for the whole period of budget stabilisation in accordance with regulations of competent agencies, the People's Council of Ha Noi City can use the redundant fund of salary reform and allow subordinate units to use redundant funds of salary reform to invest in socio-economic infrastructure.

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The rate of deducted revenues to create funds for salary reform of agencies and units with large revenues must ensure the principle that these agencies and units must self-arrange the funds to reform salary according to the roadmap decided by competent agencies and the State budget shall not allocate any additional capital for them.

The draft also stipulates that State administrative agencies, political organizations, socio-political organisations and public non-business units managed by Hanoi shall use redundant funds for salary reform to increase expenditure for investment, procurement and operational activities of agencies, organisations and units and pay for additional incomes described in Point d, and Point e of this Clause.

The Decree will be issued by the Government in 2019 after consulting all units.