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Official Gazette

Sunday, October 21, 2018

Draft law to strictly control public spending

Updated: 16:43’ - 28/06/2014

The Ministry of Planning and Investment is working on a draft Law on Public Investment, aiming to increase the effectiveness of the management and use of state resources for building a synchronous infrastructure system in the time to come.

According to Minister of Planning and Investment Bui Quang Vinh, the draft law has some salient and unique features.

First of all, the draft law governs the management and use of public investments made with different sources of capital, including the state budget, government bonds, municipal bonds, official development assistance, concessional loans, state development investment credit, revenues to be used for re-investment but not yet accounted into the state budget, and local debts for investment in the country and abroad.

The making of improper and inefficient investment decisions can be cited as a primary reason behind the loss and waste of resources in public investment projects. To tackle this issue, the draft law devotes a whole chapter (Articles 17 thru 37) to institutionalize the process of making investment decisions and the competence to decide on public investment programs and projects. This can be regarded as the most salient content of the draft law.

Another noteworthy content of the draft law involves improving and renewing the appraisal and balancing of funding sources. This aims to address low quality and efficiency of public investment programs and projects.

The draft law devises a systematic and comprehensive process for managing public investment programs and projects from the first stage of determining the investment policy to the final step of evaluating investment efficiency. The draft law provides the elaboration of investment plans, shifting from annual and short-term investment plans to five-year ones in conformity with socio-economic development plans, and the monitoring and evaluation of public investment programs and projects in line with international practices. It also deals with the decentralization of public investment management, clearly defining powers and responsibilities of each level.

The draft law is scheduled to be submitted to the National Assembly at its upcoming session in May.-


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