HCM City: Focusing on disbursement of public investment capital in the last months of 2020

Metro Line 1 is speeding up. In the photo: The Metro subway in Vietnam docked at Saigon port in early October 2020. Photo: T.H

Disbursed capital increased significantly

In 2020, the People's Committee of HCM City has assigned and allocated a detailed plan for public investment capital with total capital of VND 42,139 billion. Specifically, the capital has allocated with total capital of VND 33,940 billion. In particular, ODA from foreign loans of the Government was VND 10,487 billion while concentrated budget capital was VND 23,453 billion.

The capital allocated from the central was VND 8,198 billion, of that domestic capital was VND 3,153 billion, the ODA allocated from the central budget was VND 5,044 billion.

Regarding the capital adjustment plan, the People's Committee of HCM City issued a decision to adjust and supplement the public investment plan in 2020 in sectors, fields and programmes of 30 units using budget capital of the city.

The adjustment of capital reduction for 433 projects having low disbursement rate was VND 1,076 billion and at the same time, adjusting to increase capital for 141 projects with a high disbursement rate with an increase of VND 1,076 billion.

As of September 30, the total public investment capital of HCM City that has been disbursed was more than VND 22,295 billion, 55.3% of the total assigned capital plan. The budget capital which had been disbursed by the city was VND 19,065 billion, reaching 56.2% of the plan; the central budget capital disbursed was VND 4,229 billion, 51.6% of the assigned plan.

According to HCM City, in the first nine months of this year, the budget capital of the city has made a breakthrough in disbursement and achieved a high result compared to the plan. There were a number of key projects using large budget capital, such as the flood control project of VND 10,000 billion, that was currently speeding up construction progress to be partially put into operation in October. The construction and installation volume of the project is currently more than 83%, but the project is still slow in site clearance of some items, affecting construction progress.

Metro railway No. 1 Ben Thanh - Suoi Tien project is currently executing packages like Ba Son station and Ben Thanh station. Up to now, the whole project has reached more than 80% of the construction and installation volume and it is expected to put into operation in 2021; the Metro No. 2 project is undergoing clearance in District 10, District 1, District 3, District 12 and Tan Binh District.

Drastically implement in year-end months

Although disbursement results of public investment increased higher than last year, however, leaders of the People's Committee of HCM City believed the result of reaching more than 50% was a reminder number, not an achievement. The units should not consider it as an achievement, they must be aware of the particularly important role of accelerating disbursement of public investment capital to contribute to boosting aggregate demand for the economy, especially in the context of the effects of the Covid-19 pandemic.

Therefore, in the newly issued plan to promote the disbursement of public investment capital, the People's Committee of HCM City determined that the promotion of disbursement would contribute to stimulating aggregate demand, promoting economic growth and creating more jobs and income for workers; at the same time, promoting the stimulation of production, business, consumption, job creation and ensuring social security, contributing to promoting the construction and completion of necessary socio-economic infrastructure to improve the competition, support production and business activities of people and businesses, and attract other sources of social investment capital.

To achieve the above target, HCM City assigned the Department of Planning and Investment to advise the People's Committee of HCM City to adjust and supplement the public investment plan of 2020 from projects with low disbursement rates to projects with high disbursement rates; reviewing the medium-term public investment plan for 2016-2020 to adjust from projects that could not implement the plan to projects having demand to add to the medium-term plan.

The Department of Finance of HCM City has focused on speeding up, minimising the time for verifying and approving the settlement of completed projects; making monthly reports on the problems and propose solutions to remove difficulties in the process of settling investment capital for works construction.

In terms of disbursement procedures, the People's Committee of HCM City requested the State Treasury of HCM City to make payment for projects when it was eligible to disburse within four working days; coordinate with investors to deal with arising problems, reducing the time to control expenditures for each project and regularly urge investors and contractors to pay back in accordance with the regulations.

The People's Committees of districts should coordinate with the investors which are implementing projects in the area to implement compensation for site clearance to meet the progress requirements of the project and took responsibility to the People's Committee of HCM City if the implementation of projects in their area were behind schedule.

Besides that, for investors, it is necessary to strictly control project documents, construction drawing designs and cost estimates before submitting them to State authorities for appraisal and approval to reduce time spent implementing investment procedures.

Director of HCM City State Treasury Nguyen Hoang Hai committed that the State Treasury of HCM City would ensure to control payment of documents on time. However, Hai suggested investors should increase transactions with the treasury via online method through the online public service system; discussing problems to achieve the planned capital disbursement.