Regulation on management and payment for projects using public investment capital via State Treasury

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The State Treasury has just issued a regulation on management and payment of projects using public investment capital via the State Treasury system.

Clear regulation

According to the State Treasury, the regulation on management and payment for projects using public investment capital through the State Treasury system shall comply with Clause 1, Article 1 of Decree 99/2021/ND-CP of the Government on management, payment and settlement for projects using public investment capital (except for secret public investment projects) and works which are repaired, maintained, renovated, upgraded and expanded with costs of VND500 million or more according to Clause 6, Article 7 of Decree 11/2020/ND-CP dated January 20, 2020 of the Government on procedures in the field of State Treasury.

The scope of application will be the State Treasury of the provinces and centrally-run cities; Transaction Offices of State Treasury, State Treasury of districts, towns, provincial cities and centrally-run cities and civil servants in charge of procedures of management and payment of projects using public investment capital through the State Treasury system.

The State Treasury stipulates: "Payment before management" of public investment capital is a form of payment applicable to expenditures under contracts and multiple payments until the disbursed amount reaches 80% of the contract value.

In particular, the State Treasury agency shall carry out payment procedures immediately after receiving complete and valid applications as prescribed in Decree 99/2021/ND-CP.

The control of expenditures and settlement of inspection results shall be carried out by the State Treasury agency after such expenditures have been paid.

Accordingly, the State Treasury agency will perform "payment before management" for each disbursement (including advance/payment of the complete volume) of a multi-payment contract until the disbursed amount reaches 80% of the contract value, then switch to the form of "management before payment" for the next disbursements until the contract value is fully paid.

In case the disbursed capital has not reached 80% of the contract value but the investor requests the final payment, the State Treasury shall implement “management before payment".

The "management before payment" of public investment capital is a form of payment control applicable to expenditures without contracts and a final payment of contracts or other expenditures under contracts with a payment value greater than 80% of the contract value until the end of the contract.

State Treasury allowed to suspend capital payments in some cases

The regulation clearly states that the investor and the management board of projects using public investment capital from the state budget and lawful revenue of state agencies for investment and agencies signing PPP project contracts, the governing body is permitted to invest in the payment account at the State Treasury agency.

Along with that, the State Treasury shall receive documents sent by the investor according to the process described in Decree 11/2020/ND-CP; Decision 3519/QD of the Director General of the State Treasury and Decision 2899/QD of the Director General of the State Treasury.

Besides, the State Treasury shall control payments on the basis of dossiers and documents provided by the investor in accordance with payment principles and regulations in Decree 99/2021/ND-CP.

Moreover, the State Treasury is allowed to suspend capital payment and give written opinions to the investor in the following cases: payment reductions or refusal of payment; answering the investor's problems in capital payment; coordination with the investor and relevant agencies in recovering the capital used for the wrong purpose, wrong receivers and contrary to the State's financial management regime, and report it to the governing body and the superior State Treasury to report to the financial agency for settlement.

After completing the payment procedures, if it is discovered that the investor's application for payment has not yet met the regime or lacks documents as prescribed in Decree 99/2021/ND-CP, the State Treasury shall refuse payment and provide the reason for the refusal within three working days from the date of receiving the investor’s application.

If after the prescribed time limit, there is no response from the investor in accordance with current regulations, the State Treasury shall report to the senior and report to the financial agency for settlement.

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The regulation clearly states that the public investment capital paid for each job or item of a task or project must not exceed the approved estimate. The total amount of capital paid for the task or project must not exceed the total approved investment. The amount of public investment capital disbursed for the task and project in the year must not exceed the planned capital in the year already allocated for the projects.

In the case of payment under a contract, the contract value must not exceed the bidding package value; the payment value does not exceed the value of the signed contract or the adjusted contract.